Most (P)GCC Stocks Plummet
World Economy

Most (P)GCC Stocks Plummet

Most (Persian) Gulf Cooperation  Council Arab stock markets (comprising Saudi Arabia, Kuwait, the UAE, Qatar, Bahrain, and Oman) fell on Thursday amid soft oil prices and mixed corporate earnings, while Egypt was hit once again by concern about instability in the country’s currency.
Dubai’s index edged down 0.1%. Dubai Parks & Resorts surged 3.8% but real estate stocks were weak, with Deyaar Development dropping 1.1% after reporting a 17.8% fall in second-quarter net profit, Arabian Business reported.
Blue chip Emaar Properties, which had been rallying strongly for the past two weeks, lost steam. It edged down 0.3% to 7.00 dirhams ($1.91), failing to break major technical resistance on its October 2015 peak of 7.01 dirhams.
A few small speculative stocks rose sharply including Al-Salam Group Holding, which gained 10.6%. In Kuwait, where its shares surged 5.8%, the company issued a statement saying it knew of no material reason for the unusual trade in its shares.
Saudi Arabia’s Tadawul All-Share Index fell 0.5% to 6,601 points as Yamama Cement tumbled 5.2% after reporting a 14% year-on-year drop in second-quarter profit to SR150.5 million ($40.1 million), and slashing its second-quarter dividend to SR0.25 per share from SR0.75.
Petrochemical shares were strong, however. Yanbu National Petrochemical Co. (Yansab) rose 2.8% in its heaviest trade since January after its second-quarter net profit trebled to SR689.3 million ($183.8 million) because of higher production and sales—analysts had on average forecast SR446.2 million. Petrochemical heavyweight Saudi Basic Industries gained 0.6%.

  Widespread Selling in Banks
Abu Dhabi’s index fell 0.5% to 4,590 points, dragged down by profit-taking in merger candidates First Gulf Bank, down 1.2%, and National Bank of Abu Dhabi, off 2%.
Qatar also dropped 0.5% because of widespread selling in banks. Commercial Bank of Qatar, which slumped 6.6% on Wednesday after it missed second-quarter earnings forecasts by a large margin, fell a further 2%.
The Egyptian index sank 0.9% as the gap between Egypt’s official and unofficial US dollar rates hit it’s widest ever because of speculation that the country’s endemic foreign exchange shortage could force another devaluation. Traders told Reuters they sold dollars at record highs between 11.85 and 12.05 pounds, more than 35% above the central bank’s official rate of 8.78.
An initial devaluation in March prompted a strong rally in the stock market because of hopes it would encourage capital inflows, but this did not happen, and investors are now worried about the risk of a disorderly depreciation accompanied by punishing interest rate hikes.

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