MIDEAST STOCKS-Egypt gains on muted protests; Dubai ends lower

DUBAI Tue Feb 12, 2013 9:09am EST

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DUBAI Feb 12 (Reuters) - Egypt's index marked its biggest gain in nine days on Tuesday after protests marking the second anniversary of the overthrow of former president Hosni Mubarak a day earlier were smaller and less violent than expected.

Most other Gulf markets also rose, but Dubai's main index continued its retreat from Sunday's three-year high.

Demonstrators demanding the departure of President Mohamed Mursi clashed with police outside his palace on Monday, but these appeared more subdued than previous bouts of anti-Mursi unrest.

"Retail appetite was the main driver for the market today - everybody was cautious yesterday and thought there would be further escalation of violence but it was not as bad as expected," said Mohamed Radwan, director of international sales at Pharos Securities.

Investors also placed bets that there may be a cabinet reshuffle more in favour of the opposition. Egypt will hold parliamentary elections in April.

"A cabinet reshuffle is possible but very unlikely before the elections," says a Cairo-based trader on condition of anonymity.

Cairo's index rose 1.1 percent in its biggest gain since Feb. 3 and eighth advance in the past 10 sessions.

Palm Hills Development and El Saeed Contracting Co climbed 2.4 and 3.9 percent respectively. Citadel Capital added 1 percent.

In Saudi Arabia, the index climbed 0.4 percent to a near two-week high.

Banks and petrochemical stocks supported gains. Heavyweight Saudi Basic Industries Corp (SABIC) added 0.5 percent and lender SABB rose 2.8 percent.

Yanbu Cement surged 4 percent to a five-year high after the firm's board recommended a 50-percent increase in capital to 1.57 billion riyals. It will issue one share for every two shares held, pending approval. It will also add 262.5 million riyals to statutory reserves, according to a bourse statement.

Elsewhere, Dubai's measure fell and Abu Dhabi ended flat as some investors booked profits on fears that an early-year surge has left stocks over-priced.

Dubai's index slipped 0.5 percent, its second decline since Sunday's 38-month high.

"People are starting to worry because there's no solid catalyst to push equity prices higher," said a Dubai-based trader who spoke on condition of anonymity. "Valuations are beginning to get stretched."

Emaar Properties fell 1.2 percent to 4.9 dirhams, down for a second day since Sunday's four-year peak. Lender Emirates NBD dropped 2.1 percent.

Abu Dhabi's index ended flat, matching Monday's 35-month high and up 11.1 percent in 2013. Abu Dhabi's Commercial Bank International, which rarely trades, surged 14.8 percent.

A tentative recovery in property prices and fewer bank provisions in the last quarter has helped the UAE market mount an early-year rally, yet some worries remain.

"The most important thing is sustainability in revenues and that's not confirmed yet," the trader added.

TUESDAY'S HIGHLIGHTS

EGYPT

* The index rose 1.1 percent to 5,756 points.

SAUDI ARABIA

* The index rose 0.4 percent to 7,057 points.

DUBAI

* The index slipped 0.5 percent to 1,888 points.

ABU DHABI

* The index ended flat at 2,924 points.

KUWAIT

* The index climbed 0.6 percent to 6,357 points.

QATAR

* The index edged up 0.06 percent to 8,776 points.

OMAN

The index gained 0.2 percent to 5,869 points.

BAHRAIN

* The index eased 0.06 percent to 1,085 points.

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