May 15, 2019 / 1:32 PM / 11 days ago

MIDEAST STOCKS-Saudi Arabia up on banks, weak earnings hurt Dubai

    * All Saudi banks gain on MSCI inclusion
    * DAMAC Properties hits life-time low
    * Arabtec, Aldar decline on weak Q1 results
    * 26 of 30 stocks on Egypt's index fall
    * Mesaieed highest since June 2015

    By Ateeq Shariff
    May 15 (Reuters) - Saudi Arabia's stock market rose
moderately on Wednesday, lifted by its banking shares following
index provider MSCI's decision to include multiple lenders,
while Dubai was pressured by a string of disappointing corporate
earnings.
    Saudi Arabia's index increased 1.3% with Al Rajhi
Bank gaining 2.1% and Alinma Bank rising
2.6%, while National Commercial Bank was up 0.9%.
    "The 10% to 15% correction in large caps especially the top
banks made them look pretty reasonable in terms of valuations,"
said Vrajesh Bhandari portfolio manager at Al Mal Capital. 
    "And therefore, we are seeing interest in these names before
the MSCI inclusion gets effected later this month (potentially)
driving in $7 billion to the market. Having said that, investors
need to have a close eye on geo-political factors." 
    The index fell as much as 2.1% on Tuesday after drone
attacks but recovered to close 0.1% higher. Saudi Arabia said
drones had struck oil pumping stations two days after its oil
tankers were sabotaged off the coast of the United Arab
Emirates.
    "With rising tensions between Iran and the U.S., and with
significant naval build-up in the region, markets are sensitive
to news and can be tipped by the smallest signs of a conflict,"
said Mihir Kapadia, chief executive officer of Sun Global
Investments.
    In Dubai, the index closed 1.1% lower with real
estate firm Emaar Properties dropping 2.3%.
    Arabtec Holding plunged 7%, its biggest intraday
loss since mid-November, as its first-quarter profit halved to
31.8 million dirhams ($8.66 million) from 63.6 million dirhams
the year before.
    DAMAC Properties lost 2.9% after it posted a 94%
drop in its first-quarter net profit. A slump in the Dubai
property market hurt the company, which reported its smallest
net profit since going public in 2015.
    Amusement park operator DXB Entertainment declined
5.1% on a wider first-quarter loss. 
    Its aim to reach an EBITDA break-even by the second half of
2020 was challenging, considering weak first-quarter revenue
growth and footfall, Arqaam Capital said in a note.
    Egypt's blue-chip index, declined 1.5% with El
Sewedy Electric shedding 3.5% and Eastern Company
 was down 1.5%.
    The Abu Dhabi index fell 0.5%, led by a 0.6% fall in
First Abu Dhabi Bank (FAB).
    Index provider MSCI decided against increasing FAB's foreign
inclusion factor, despite the lender raising its foreign
ownership limit to 40% from 25%.
    Aldar Properties dipped 2.3% after the realtor
reported a drop in its first-quarter profit.
    Qatar's blue chip index added 0.7% with Mesaieed
Petrochemical soaring 9.5%, to reach its highest in
nearly four years. 
    On Tueday, MSCI included Mesaieed and Qatar Fuel
in the index review. Qatar Fuel was down 0.2%.
    
 SAUDI ARABIA  The index         was up 1.3% at 8,481 points
 ABU DHABI     The index        dropped 0.5% to 4,778 points
 DUBAI         The index          fell 1.1% to 2,584 points
 QATAR         The index        added 0.7% to 9,864 points
 EGYPT         The index          declined 1.5% to 13,809
               points
 BAHRAIN       The index        was flat at 1,409 points
 OMAN          The index        was also flat at 3,828 points
 KUWAIT        The index        rose 0.2% to 6,011 points
 
($1 = 3.6729 UAE dirham)

 (Reporting by Ateeq Shariff in Bengaluru; editing by Emelia
Sithole-Matarise)
  
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