March 14, 2019 / 1:59 PM / 6 months ago

MIDEAST STOCKS-Abu Dhabi hits multi-year peak, blue-chip banks lift Qatar

    * Abu Dhabi's FAB records best day in nearly 3 years
    * Qatar on track for best day since Aug 2018
    * Dubai's DP World jumps on higher FY profit
    * Saudi's Al Khodari surges after dissolution voted down 

    By Shakeel Ahmad and Abinaya Vijayaraghavan
    March 14 (Reuters) - The Abu Dhabi stock market climbed
sharply on Thursday for its biggest one-day gain in nearly three
years while Qatar was lifted by its blue-chip banks to its best
day in seven months. 
    The Abu Dhabi index rose 3.7 percent. First Abu Dhabi
Bank (FAB), the United Arab Emirates' biggest bank,
surged 6.5 percent and Emirates Telecommunications
added 5.2 percent. 
    With FTSE and S&P index rebalancing ataking place across
emerging markets on Thursday there were sizeable inflows into
heavyweights First Abu Dhabi and Emirates Telecommunications,
which account for about 70 percent of the Abu Dhabi index, said
Mohamad Al Hajj, head of MENA equity strategy for EFG Hermes.
    Late last month FAB shareholders approved an increase in the
limit of foreign ownership to 40 percent of its shares, up from
25 percent.
    FAB expects the MSCI to reflect the foreign ownership
limit's increase during its May index review, Arqaam Capital
said, adding that the brokerage expects about $615 million of
inflows from MSCI and $275 million from FTSE. 
    Qatar's index rose 2.1 percent, with Industries Qatar
, the stock with the biggest weighting on the index, 
climbing 3 percent and Qatar Islamic Bank up 3.2
    The index is down 4.8 percent this year, lagging behind Gulf
peers. This is in sharp contrast to last year, when the index
was one of the world's best-performing markets after the raising
of the limit on foreign ownership of Qatari stocks.
    Some analysts consider the market to be overvalued, with
other regional markets offering better valuations.  
    In Dubai, the index fell 1 percent. Dubai Islamic
Bank lost 6.5 percent as the stock traded ex-dividend.
    Banks in the UAE are expected to suffer a rise in loan
losses over the next 12 to 18 months as a decline in real estate
prices and rising interest rates reduce borrowers' cashflows,
according to Moody's.
    But DP World, the Dubai-Nasdaq listed port
operator, climbed 6.2 percent in light trade after posting 2018
profit up 10.2 percent.
    Saudi Arabia's index was up 0.7 percent, with Al
Rajhi Bank gaining 0.9 percent. 
    Saudi Basic Industries (SABIC), the Middle East's
largest petrochemicals maker, rose 1 percent after announcing on
Wednesday that it will merge its Saudi Petrochemical Co and
Arabian Petrochemical Co businesses.
    The deal, due to complete in the second half of the year, is
part of SABIC's efforts to increase efficiency globally.
    Abdullah Abdul Mohsin Al Khodari Sons rose 10
percent after its shareholders voted down dissolution of the
company and instead approved capital restructuring.
    Egypt's blue-chip index was down 0.9 percent, with
Commercial International Bank shedding 1.9 percent and
El Sewedy Electric slipping by 1.7 percent. 
    The index has gained 15 percent so far this year, compared
with an 8.8 percent gain for the MSCI's index of developing
world stocks. 
 SAUDI       The index         rose 0.7 pct to 8,583 points
 ABU DHABI   The index        rose 3.7 pct to 4,998 points
 DUBAI       The index          fell 1 pct to 2,574 points
 QATAR       The index        rose 2.1 pct to 9,971 points
 EGYPT       The index          fell 0.9 pct to 14,991 points
 KUWAIT      The index        rose 1.2 pct to 5,667 points
 OMAN        The index        was flat at 4,075 points
 BAHRAIN     The index        fell 0.2 pct to 1,409 points

 (Reporting by Shakeel Ahmad and Abinaya Vijayaraghavan in
Editing by David Goodman)
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