September 16, 2019 / 1:51 PM / 3 months ago

MIDEAST STOCKS-Saudi funds, oil assurance steady stocks after Aramco attack

    * Most Banks rise in Saudi
    * Lender FAB boosts Abu Dhabi
    * Financials, property aid Dubai
    * Industries Qatar, QNB lift Qatar

    By Shakeel Ahmad
    Sept 16 (Reuters) - Saudi Arabian stocks were supported by
domestic funds on Monday after top oil producer Saudi Aramco
IPO-ARMO.SE assured some clients that there will be no supply
shortage as a result of Saturday's attack on its
facilities.
    The attack shut about 5% of global supply, sending oil
prices as much as 19.5% higher, their biggest intra-day
percentage gain since 1991's Gulf War.
    Despite Aramco's assurance, concerns remain over oil supply
which could be disrupted if the outage continued for long, while
a full return to normal oil production volumes "may take
months", sources told Reuters.
    It could also have a wider impact on Saudi Aramco's planned
initial public offering (IPO) on its home market.
    "The attacks could complicate Aramco’s IPO plans given
rising security risks and potential impact on its valuation,"
Eurasia wrote in a note to clients.
    After losing 1.1% on Sunday, the country's stock market
index closed 1% higher with its biggest lender National
Commercial Bank surging 4.2% and Al Rajhi Bank
 rising 1.4%.
    Traders cited buying by local and regional investors, as
most foreign active investors have already exited the index,
which is trading roughly flat year-to-date after it rose as much
as 20% at its peak in May. 
    "Our channel checks suggest most of the ‘active’ foreign
money in KSA has already exited the market and what is left is
passive funds, who have to stay invested," said Vrajesh
Bhandari, senior portfolio manager at Al Mal Capital.
    It means local and regional institutions and retail
investors are calling the shots and that supply can be
relatively better controlled with some support from domestic
funds, Bhandari added. 
    Other major Gulf markets also rose as cheaper valuations
attracted the investors. 
    The Abu Dhabi index rose 1.7% boosted by a 2% jump in
the United Arab Emirates' biggest lender First Abu Dhabi Bank
 and a 2.6% Emirates Telecommunications Group
    "In terms of fundamentals, certain high quality companies
across MENA are currently being undervalued and investors are
gradually adding to their exposure," Bhandari said. 
    Qatar's index gained 1.1% with petrochemical maker
Industries Qatar up 2.3% and Qatar National Bank
 1.3% higher.
    In Dubai, the index was down 0.3% with the market
heavyweight lender Emirates NBD gaining 0.8%.
    The emirate's largest lender has risen 17.5% this month
after it raised its foreign ownership limit to 20% from 5% and
announced its intention to lift the limit to 40%. 
    Outside the Gulf, Egypt's blue-chip index was down
0.4% with real estate investment firm Talaat Mostafa Group
Holding dropping 2.1%.
    
 SAUDI ARABIA  The index         rose 1% to 7,827 points
 ABU DHABI     The index        rose 1.7% to 5,161 points
 DUBAI         The index          was up 0.3% to 2,878 points
 QATAR         The index        gained 1.1% to 10,512 points
 EGYPT         The index          lost 0.4% to 14,970 points
 BAHRAIN       The index        fell 0.7% at 1,524 points
 OMAN          The index        slipped 0.3% to 4,009 points
 KUWAIT        The index        declined 2.2% to 6,101 points
 

 (Reporting by Shakeel Ahmad in Bengaluru;
Editing by Alexander Smith)
  
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