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DUBAI / Reuters
Major stock markets in the Gulf rebounded in late trade on Monday to close higher despite the collapse of oil producers’ talks in Doha, while Egypt’s bourse surged to a six-month closing high.
The failure of Sunday’s Doha meeting to agree on an oil output freeze was a blow to sentiment in the oil market, and Brent crude tumbled more than 5 percent at one stage. But it later came well off its lows to stand only 2.6 percent down at $42 a barrel.
This was a relief to Gulf bourses, which were also encouraged by some positive first-quarter earnings in Saudi Arabia that suggested the region’s economic slowdown was not hurting corporate profits as much as feared.
The Saudi stock index, which fell as much as 1.6 percent in early trade, rebounded to close 0.2 percent higher, led by the petrochemical sector.
Petrochemical producer National Industrialisation Co (Tasnee) surged 9.8 percent after posting a first-quarter net loss of 94.8 million riyals ($25.3 million), beating analysts’ forecasts of a 272.9 million riyal loss.
NCB Capital attributed the result to higher-than-expected gross margins on the back of improved efficiency and higher operating rates.
But the second largest listed petrochemical producer, Saudi Arabia Fertilisers Co (SAFCO), slumped 3.8 percent to 62.75 riyals after reporting a 51.5 percent decline in net profit to 286 million riyals. Analysts had expected the unit of Saudi Basic Industries to make 314.6 million riyals. Riyad Capital attributed the fall mainly to lower urea prices and revised its target price for the stock to 70.0 riyals from 80.0, maintaining a “hold†rating.
BANKS ON THE UP
Another commodity producer, Saudi Arabian Mining Co (Ma’aden), climbed 6.3 percent after reporting a 35.3 percent fall in first-quarter net profit to 168.9 million riyals versus analysts’ average estimate of just 1.13 million riyals. Dubai’s index was down as much as 2.5 percent but finished 0.1 percent higher.
Builder Drake & Scull, the most heavily traded stock on the bourse, added 3.5 percent. Emirates NBD, the biggest bank, gained 2.5 percent.
In Abu Dhabi, the index edged up 0.03 percent, helped by banks. Abu Dhabi Islamic Bank gained 4.4 percent and First Gulf Bank, the most valuable listed lender, added 0.4 percent.