October 7, 2018 / 8:08 AM / 2 months ago

MIDEAST STOCKS-Drake and Scull jumps in Dubai, outperforming weak Gulf markets

DUBAI, Oct 7 (Reuters) - Gulf markets opened in negative territory on Sunday mirroring a slump in global stocks late last week.

In Dubai the index shed 0.2 percent in early trade, but contractor Drake and Scull International (DSI) outperformed, jumping 7.3 percent to 0.44 dirhams ($0.1198) after the company said a majority of shareholders approved the company continuing its business at a general assembly last Thursday.

DSI, which has faced mounting losses since 2015, called a shareholder meeting in accordance with UAE companies’ law, which states that shareholders must decide on whether to dissolve a company if its losses amount to half of its issued share capital.

The company said on Sunday its shareholders were also informed of the company’s future plans and on developments in an investigation by current management with regard to the previous executive management, but it did not add any details.

In Saudi Arabia the index was down 0.4 percent after 20 minutes of trading. Saudi Kayan Petrochemical Co was down 2 percent, drawing the highest trading volume in early trade.

Almarai, the Gulf’s largest dairy company, lost 0.9 percent after reporting a drop in third-quarter net profits on Sunday. The company posted 634.5 million riyals ($169.19 million) against 667 million riyals during the same period last year.

Analysts had a median forecast of 654 million riyals, according to Refinitiv data.

Advanced Petrochemical fell after reporting a slight decline in quarterly net income to 202 million riyals, above analysts’ median forecast of 188 million riyals.

Shares in Alawwal Bank were up 0.1 percent, marginally extending last week’s gains after Saudi British Bank (SABB) secured a binding deal for the $5 billion acquisition of Alawwal.

Under their binding deal, reached after the banks revealed merger talks earlier this year, SABB will pay for the merger by issuing new shares and the deal values each Alawwal share at 16.26 riyals, the banks said.

Although the agreement values Alawwal above its current market price, SABB could benefit from increased size. Shares in SABB were down 0.8 percent on Sunday. ($1 = 3.7502 riyals) ($1 = 3.6730 UAE dirham) (Reporting by Davide Barbuscia; Editing by Susan Fenton)

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