Oman rebounds from cyclone selloff

Oman's index surged to a record high on Wednesday as investors snapped up stocks hit by panic selling after last week's cyclone. Stocks likely to benefit from spending on reconstruction lead the rally.

Kuwait's index notched up its highest close in 16 months as Mobile Telecommunications Co. (MTC) extended gains into a second day.

Benchmarks in Dubai, Bahrain and Abu Dhabi also closed higher, while Qatar's and Saudi Arabia's fall.

HIGHLIGHTS OF WEDNESDAY'S TRADING

OMAN
* The index ended 0.92 % up at 6,273 points, its highest ever close, after touching a life high of 6,289.91 points during the session. Investors took the view that a 3.13 % drop on Monday, when the market reopened after Cyclone Gonu, was too sharp, said Rami Sidani, senior associate at Shuaa Capital.

* Bank Muscat gained for a second day, ending 1.11 % up. The stock tumbled 4.08 % on Monday. "The cyclone changed nothing in terms of the fundamentals so people realised there was still value there," Sidani said.

* Raysut Cement rose 2.57 % and Oman Cable 2.57 %. "These are definitely stocks that will benefit from any reconstruction," Sidani said.

KUWAIT

* The index ended at its highest since Feb 14, 2006, rising 0.57 % to 11,676.20 points. During the session the index topped 11,700 points for the first time since Feb. 22, 2006.

* MTC jumped 2.27 %, its second day of gains since the Saudi government approved its bid to set up the kingdom's third mobile operator. The stock has doubled in value this year and is trading at 28 times 2006 earnings, according to Shuaa Capital. "We see this price move as exaggerated and a correction is due," Sidani said.

* Logistics firm Agility rose 1.28 % after shareholders approved a 20 % stock dividend and a 90 % cash dividend. The stock was suspended for the announcement that a Kuwaiti court had ruled in the company's favour in its challenge against a government decision to revoke a contract with Agility.

DUBAI
* The index rose 1.53 % to 4,493.61 points
* Emaar Properties gained 1.68 %, partly driven by optimism it would give details of a land-for-stocks deal with government-owned Dubai Holding, said Amr Diab, head of sales at EFG Hermes brokerage.

* Gulf Navigation Co. was the top gainer, surging 14.29 %. Diab said rally was driven mostly by retail investors.

ABU DHABI

* The index climbed 0.11 % to 3,610.49 points.

* Shares of National Bank of Abu Dhabi rose 0.72 % after comments from its chief executive renewed speculation about a merger with Abu Dhabi Commercial Bank. Abu Dhabi Commercial fell 0.58 %.

SAUDI

The index ended 0.01 % down at 7,074.51 points, its third day of declines, as investors braced for IPOs that could drain cash from the market. "The market overreacted negatively to the announcement of large IPOs, bringing the valuations to attractive levels," said Mohamed al-Omran, head of the Arab Center for Financial Consultancy. "But we are not out of the woods yet."

BAHRAIN

*The index rose 0.57 % to 2,345.11 points.

* Shares of Bahrain Telecommunications Co dropped 0.32 % after the company said the telecom regulator had ordered it to comply with "unfair commercial arrangements" on access to Bahrain's network infrastructure.

QATAR
The index fell 0.16 % to 7,413 points.

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