May 13, 2019 / 2:07 PM / 5 months ago

MIDEAST STOCKS-Trade tensions, tanker attacks darken mood in Gulf markets

    * Saudi insurers among biggest fallers after weak Q1 results
    * Abu Dhabi suffers worst day in 3-1/2 years
    * Dubai in sharpest one-day decline in 3 years
    * 18 of 20 Qatari stocks slide

    By Shakeel Ahmad
    May 13 (Reuters) - Dubai and Abu Dhabi stock markets suffered their biggest
single-day decline in years on Monday after several commercial ships were
attacked off the coast of the United Arab Emirates.
    Saudi shares had their worst day since mid-October after Riyadh said two of
its oil tankers were among the vessels hit in the attacks.
    Saudi Arabia's index declined 3.6%, with Al Rajhi Bank
dropping 4.6% and petrochemical group Saudi Basic Industries falling
5.1%. The index is down nearly 10% since the start of May.
    Saudi Arabia said the two Saudi oil tankers were attacked off the coast of
the UAE and said it was an attempt to undermine the security of crude supplies
amid heightened U.S.-Iranian tensions. 
    The UAE said on Sunday that four commercial vessels were sabotaged near
Fujairah emirate, one of the world's largest bunkering hubs lying just outside
the Strait of Hormuz, but did not say who was behind the attack or describe the
nature of it.
    “The declines today in the Gulf markets reflect cautious sentiment amongst
investors amid regional uncertainty," said Mihir Kapadia, chief executive, Sun
Global Investments. "The sabotage attack of two Saudi oil tankers off the coast
of the UAE has surprised investors who are already jittery due to rising trade
tensions between the U.S. and China." 
    Shares in National Shipping Company of Saudi Arabia (Bahri)
dropped 3%, after trading and shipping sources said the Saudi vessels targeted
were Bahri-owned very large crude carrier Amjad and crude tanker Al Marzoqah.
    Bahri did not respond to a request for comment.
    Insurance companies were among biggest fallers on the Saudi market. Gulf
Union Cooperative Insurance and Salama Cooperative Insurance
each fell 10% after they reported first-quarter losses, citing increased net 
claims.
    Vrajesh Bhandari, senior portfolio manager at Al Mal Capital, said Saudi
Arabia has its own dynamics. With about 10% correction in large caps, we see it
as a tactical opportunity to position for the first tranche of MSCI, he said.
    Saudi Arabia is due to be included in the MSCI index from later this month. 
    The Dubai index was down 4% in the sharpest single-day decline
since June, 2016 with 26 of 37 stocks falling and none rising. 
    Financial and real estate stocks were hit the hardest. The emirate's largest
listed developer, Emaar Properties, lost 5.9%, and its biggest bank,
Emirates NBD, closed 3.6% lower.
    Bhandari said sentiment was weak and that investors would like to profits in
stocks that have done well – such as Emirates NBD. 
    "Overall, we expect markets to be volatile given seasonal factors - Ramadan
and the summer. Global factors aren’t helping either," Bhandari added.
    Financials also pushed Abu Dhabi's index down 3.3%, its biggest
one-day drop since January, 2016.
     First Abu Dhabi Bank, the UAE's biggest bank, shed 3.1% and
Emirates Telecommunications Group dropped 5.7%.
    Qatar's index lost 1.9% with 18 of its 20 stocks declining. Market
heavyweight Qatar National Bank decreased 2.8% while lender Masraf Al
Rayan was down 3.1%. 
    Outside the Gulf, Egypt's blue-chip index fell 1.5% mirroring
decline in emerging markets as concerns over U.S.-China trade dispute
intensified.
    The country's top bank, Commercial International Bank and
investment firm, Egypt Kuwait Holding, dropped 1.7% and 2.3%,
respectively. 
     
 SAUDI       The index         was down 3.6% at 8,367 points
 ARABIA      
 ABU DHABI   The index        fell 3.3% to 4,929 points
 DUBAI       The index          lost 4% to 2,526 points
 QATAR       The index        slid 1.9% to 9,740 points
 EGYPT       The index          was down 1.5% to 13,905 points
 BAHRAIN     The index        was down 0.8 pct at 1,416 points
 OMAN        The index        slipped 0.7% to 3,840 points
 KUWAIT      The index        lost 1.4% to 6,079 points
 

 (Reporting by Shakeel Ahmad in Bengaluru and Saeed Azhar in Dubai. Editing by
Jane Merriman)
  
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