* UAE, Qatar bourses recover after dipping on foreign
* Emaar at six-year high ahead of malls unit's IPO
* Lifts Dubai above 5,000-point mark
* Saudi bourse continues uptrend
* But analysts say market may be overheating
By Olzhas Auyezov
DUBAI, Aug 31 Bourses in the United Arab
Emirates and Qatar rebounded on Sunday while Dubai developer
Emaar Properties surged after the firm said it would
launch an initial public offer for its malls unit next month.
Stock markets in both countries had dipped in the previous
session as passive funds tracking MSCI's frontier market index
liquidated part of their holdings of UAE and Qatari stocks. MSCI
upgraded the UAE and Qatar from frontier to emerging market
status in May and arranged for frontier funds to exit those
countries through a series of monthly sales, one of which took
place at the end of last week.
Qatar's bourse, which dropped 3.1 percent on
Thursday, bounced 1.1 percent on Sunday as stocks that were the
main drags in the last session became the main supports.
Islamic lender Masraf Al Rayan jumped 6.4 percent
and mobile phone operator Ooredoo surged 7.2 percent.
At the same time, three stocks that attracted foreign buyers
last Thursday because of a planned end-August increase of their
weights in MSCI's emerging market index - Qatar National Bank
, Industries Qatar and Qatar Islamic Bank
- fell 4.2, 1.9 and 2.4 percent respectively.
Abu Dhabi's bourse rose 0.2 percent on the back of
its heaviest MSCI index components. National Bank of Abu Dhabi
rose 0.7 percent and First Gulf Bank added
Dubai's index jumped 2.7 percent and closed above
5,000 points for the first time since early June thanks to
Emaar, the emirate's largest listed developer, which surged 8.8
percent to 11.15 dirhams, its highest close since March 2008.
The company said on Sunday that it would launch an IPO for
its malls unit next month in what will be the emirate's largest
share sale in recent years. Emaar plans to sell at least 15
percent of the malls and retail unit on the Dubai Financial
Market and to list the shares in October, a spokesman told
Earlier this year, Emaar said it would sell up to 25 percent
of the unit in an offer likely to raise 8 to 9 billion dirhams
($2.18-$2.45 billion) and use the cash to pay a special dividend
to its shareholders.
Saudi Arabia's bourse, boosted by regulators' plans
to open it to direct foreign investment early next year, which
were announced last month, continued to climb, rising 0.6
percent to a fresh six-year high of 11,112 points.
Al Rajhi Bank and Saudi Kayan Petrochemical Co
were the main supports, adding 2.5 and 4.5 percent
respectively. Food producer Savola Group, up 1.2
percent, and utility firm Saudi Electricity Co, which
rose 2.6 percent, also buoyed the benchmark.
"Across the board there's interest from local and regional
investors to participate and position prior to the opening of
the market," said Marwan Shurrab, fund manager and head of
trading at Vision Investments in Dubai.
But some analysts say the market is becoming stretched.
"There are already signs that the...index is moving towards
being overheated, having risen over 10 percent since the
announcement on July 21," Riyadh-based Jadwa Investment said in
a note on Sunday.
"It is important to highlight, however, that the surge in
optimism fuelling the current TASI rise is not based wholly on
speculative gain or positive sentiment - it is also a due to a
flourishing Saudi economy, which is underpinned by strong
The monthly Reuters survey of Middle East investment funds,
published on Sunday, found them still bullish on Saudi equities,
though somewhat less so than in the previous survey. Managers
were also positive, to a lesser degree, on stock markets in
Qatar, the United Arab Emirates and Egypt.
Egypt's bourse edged up 0.1 percent on Sunday on the back of
blue chip Commercial International Bank, up 0.6
percent, and brokerage Pioneers Holding, which gained
* The index rose 1.1 percent to 13,597 points.
* The index jumped 2.7 percent to 5,063 points.
* The index edged up 0.2 percent to 5,083 points.
* The index rose 0.6 percent to 11,112 points.
* The index climbed 0.1 percent to 9,447 points.
* The index added 0.4 percent to 7,431 points.
* The index climbed 0.1 percent to 7,367 points.
* The index slipped 0.2 percent to 1,472 points.
(Editing by Andrew Torchia)