August 25, 2019 / 1:29 PM / 6 months ago

MIDEAST STOCKS-Saudi index drops amid global weakness, Aldar tumbles in Abu Dhabi

    * U.S.-China trade war escalation weighs on markets
    * Saudi index the worst performer
    * Saudi banks, petchem companies tumble
    * Blue chip developers Emaar, Aldar drop in UAE

    DUBAI, Aug 25 (Reuters) - Most Middle East markets dropped
on Sunday amid thin trading volumes, mirroring a tumble in
global stocks last week and weighed down by sliding oil prices.
    Brent crude futures fell 58 cents on Friday, or 1%,
to settle at $59.34 a barrel, while Wall Street stocks tumbled
after President Donald Trump told U.S. companies to look at
alternatives to China for manufacturing, following Chinese
retaliatory tariffs on American goods.
    The Saudi index was the worst performer, losing
2.4%, dragged down by banks and the petrochemical sector.
    The rest of the region was also in red territory, except the
Egyptian and the Bahraini exchanges, which were little changed.
    "We seem to be getting dragged down by international
markets," said a Dubai-based trader. "It’s a quiet day, not the
good kind."
    Islamic lender Alinma Bank was among the worst
performers in Saudi Arabia, shedding 4%. The bank earlier this
month posted a 12% rise in second-quarter net profit.
    In the petchem sector, Saudi Kayan Petrochemical Co
 was heavily hit, losing 3.9%, while blue chip Saudi
Basic Industries Corp (SABIC) lost 2.5%.
    Arqaam Capital said in a research note on Sunday it expected
some weakness in the Saudi stock market this week as global
index compiler MSCI completes the second phase of its upgrade of
Saudi Arabia to emerging market status.
    "We expect to see circa $6.8 billion of passive inflows into
KSA (Saudi Arabia) as part of Phase 2 of EM inclusion, bringing
KSA to its full weight," said the Dubai firm.
    "However, it appears that the KSA index trade is mostly
over, as we have already recently seen significant selling
pressure, and expect to see weakness into the trade this week."
    In the UAE, large property developers were hurt.
    In Dubai, where the index lost 1.9%, Emaar
Properties lost 3.9%, while in Abu Dhabi, where the
index shed 1.4%, Aldar Properties tumbled
    Outside of the Gulf, the Egyptian index edged up
0.1%, as a 1.4% drop by Orascom Investment Holding was
partly offset by a 3.7% spike in Egyptian Resorts Co,
which was the best performer on Sunday and among the stocks
seeing the highest trading volume.
 SAUDI ARABIA  The index         dropped 2.4% to 8,242 points
 ABU DHABI     The index        lost 1.4% to 4,968 points
 DUBAI         The index          fell 1.9% to 2,716 points
 QATAR         The index        lost 1.0% to 9,818 points
 EGYPT         The index          edged up 0.1% to 14,341 points
 BAHRAIN       The index        was flat at 1,534 points
 OMAN          The index        shed 0.2% to 3,980 points
 KUWAIT        The index        dropped 1.7% to 6,496 points

 (Reporting by Davide Barbuscia, Editing by William Maclean)
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