MIDEAST STOCKS-Bluechips help Saudi hit 12-day high; Qatar up
DUBAI Nov 5 (Reuters) - Saudi Arabia's bourse surged to a 12-day high on Tuesday thanks to renewed investor confidence in bluechip petrochemical and banking shares following signs of recovery in third-quarter earnings.
The main index rose 1.2 percent to 8,170 points, its highest close since Oct. 24 and also its fifth consecutive gain.
Petrochemical shares index added 1.6 percent. Saudi Basic Industries Corp (SABIC), the largest stock by market value in the region, climbed 2.2 percent.
Most of the sector's firms last month reported growth in third-quarter earnings and some numbers were above forecasts. This was a change from depressed growth in recent quarters where weaker global demand weighed.
"We're positive on petrochemicals - there are some growth stories and also good dividend yield in mature stocks," said Farooq Waheed, senior portfolio manager at Riyad Capital. "With global macro numbers improving, product prices are also likely to improve."
The other heavyweight sector of banks, which accounts for about 30 percent of the market's value, advanced 1.4 percent.
The retail sector, which has led gains most of the year, also rose 1 percent, but was a laggard.
Some of the sectors' favourites, like Fawaz Abdulaziz Alhokair disappointed investors last month with quarterly earnings.
The stock tumbled 8.3 percent in October before staging a recovery and was up 0.2 percent on Tuesday.
"Investors are now reacting to the fundamentals of bluechips and shifting their focus from retail sector, which is over-priced," said Hesham Tuffaha, a Riyadh-based fund manager.
In the long term, retail is still a good bet, as growth in the sector, driven by local consumption, will continue to outperform that of petrochemical firms and banks, he added.
In Qatar, foreign institutional investors helped lift the index to a 10-week high. It rose 0.8 percent to 9,915 points, its highest close since Aug. 25, but hasn't cleared the previous peak of 9,922 points - Sept. 19's intraday high. This level might still prove to be a resistance.
Trading volumes jumped to their highest in seven weeks.
The market has been lagging gains in most other Gulf bourses as weak earnings disappointed investors. Dividend-hunters however, tend to buy the market before the year-end. Qatari companies pay among the highest dividends in the region; these are announced with the first quarter corporate results.
"Qatar has strong growth prospects going into next year, given that we'll see a faster trend on projects and good dividend yields," said Rami Sidani, Dubai-based head of investments at Schroders Middle East.
The Gulf state gearing up to host the FIFA World Cup 2022 is expected to tender infrastructure projects in the coming quarters, having seen several delays already.
Large-caps Qatar National Bank, the region's biggest lender by market value, and Industries Qatar rose 1.2 and 0.9 percent respectively.
Foreign institutionals were net buyers, while Qatari institutionals were net sellers, bourse data showed.
In the United Arab Emirates, investors opted to book gains in Dubai post earnings season and due to a lack of fresh catalysts. Dubai's index shed 0.3 percent, trimming 2013 gains to 78.9 percent.
Trading was thin with daily volumes slumping to a near-three-month low.
Shares in Dubai Financial Market dropped 2.3 percent after the Gulf's only-listed bourse posted third-quarter results that were slightly better than analysts' forecasts. The stock is still up 125.5 percent year-to-date.
Bluechip Emaar Properties slipped 0.3 percent.
Abu Dhabi's benchmark added 0.2 percent.
Elsewhere, markets in Egypt, Kuwait and Oman were shut for the Islamic New Year holiday.
* The index rose 1.2 percent to 8,171 points.
* The index climbed 0.8 percent to 9,915 points.
* The index slipped 0.3 percent to 2,903 points.
* The index gained 0.2 percent to 3,853 points.
* The index slipped 0.3 percent to 1,198 points.
- Housing, jobs data weaken, but overall economic picture still upbeat
- Putin critic Khodorkovsky in Germany after pardon |
- Target cyber breach hits 40 million payment cards at holiday peak |
- Pizza outlet attacked as India, U.S. fail to cool diplomat row |
- New York Mayor-elect's reputation for lateness parodied on Twitter