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DUBAI / Reuters
Most Gulf stock markets rose early on Wednesday after drops in global bourses and oil prices, but banking shares continued to support Saudi Arabia. In the nine days through Monday, the Saudi index added 10.1 percent in response to the success of Riyadh’s international bond issue, which eased concern about tight liquidity in the banking system.
On Tuesday, the index pulled back slightly, but in the first half-hour of trade on Wednesday it edged up 0.2 percent as the banking sector climbed 0.3 percent, suggesting positive sentiment due to the bond issue has not yet faded.
The biggest lender, National Commercial Bank, fell back 1.1 percent but major Islamic lender Al Rajhi climbed 0.9 percent. The petrochemical sector edged down 0.1 percent, and many gainers were second- or third-tier stocks favoured by local retail investors, such as air conditioner maker and retailer Shaker, which rose 3.4 percent after its board approved a 0.75 riyal dividend for the first nine months of this year to shareholders registered this Thursday.
Dubai’s index fell 0.7 percent with Emaar properties losing 0.9 percent, while a 2.4 percent slide in telecommunications operator Etisalat
helped to pull Abu Dhabi’s index down 1.0 percent.
Qatar’s index also dropped 1.0 percent to 10,098 points as petrochemicals and metals blue chip Industries Qatar sagged 1.6 percent.
The index is close to confirming a clean break of technical support at 10,153-10,160 points, where its September low coincides with its 200-day average. That would break the consolidation range of the past six weeks, pointing down to around 9,800 points.
Kuwait’s stock index fell 0.4 percent, but Kuwait Finance House, the country’s biggest Islamic lender, rose 2.1 percent after reporting a 20.5 percent rise in third-quarter net profit to 52.3 million dinars ($172.9 million).
EFG Hermes had forecast the lender would make a quarterly net profit of 33.8 million dinars while HSBC had estimated 64.0 million dinars.
Egypt bucks emerging markets to rise on pro-investment measures
Egypt’s blue chip shares rose on Wednesday, bucking a downtrend among emerging markets, after the government approved 17 steps designed to boost investment, including an extended suspension of the capital gains tax.
The EGX 30 index climbed 1.3 percent, with Global Telecom adding 2.7 percent and real estate developer Talaat Mostafa rising 3.8 percent. However, the broader EGX 100 index edged down 0.1 percent.
The government had imposed a 10 percent tax on capital gains from shares in July 2014 but froze it for two years in August 2015. On Tuesday the Supreme Investment Council said the freeze would be extended for three years, though it was not clear if that was from now or from the intended end in 2017.
The measures included tax exemptions for farmers and manufacturers who produce strategic crops or goods that Egypt imports or exports. There will also be new ways to settle tax disputes and to reduce bureaucratic barriers to investment, such as temporary manufacturing licenses while factories complete paperwork.
The steps appeared unlikely in themselves to resolve Egypt’s severe foreign currency shortage or boost growth any time soon, but they were seen as a positive signal that the government had the market’s interests in mind, said a local fund manager.
Foreign investors, who had been heavy net sellers of Egyptian stocks for the previous two days, were roughly neutral early on Wednesday, exchange data showed.