Dubai index sees largest weekly decline since May

Dubai Financial Market is still up nearly 14% in 2013 but has been drifting since late Feb

Dubai's index rallied from an eight-week low on Thursday as bargain hunters returned, but this was not enough to stop the benchmark making its largest weekly decline since May.

The index rose 0.5 percent, trimming weekly losses to 3.4 percent. It is up 13.7 percent in 2013 following an early-year surge, but has been drifting lower since late February as investors await first-quarter earnings to see if this year's gains are justified.

"Some valuations are stretched and I'd be happy to see some more correction," said Ali Adou, portfolio manager at The National Investor. "There isn't a reason to be bearish as the macroeconomic picture is still intact."

Bargain hunters will help slow declines, he added.

Bellwether Emaar Properties was Thursday's main support, rising 2.8 percent, while courier Aramex and Dubai Financial Market added 2.8 and 1.9 percent respectively.

Abu Dhabi's measure climbed 0.4 percent to be up 0.7 percent for the week.

Elsewhere, Qatar's measure fell for a third session in five, slipping 0.2 percent to close 8,586 points. It has traded within a 100-points range for the last two weeks.

"As long as it stays above 8,400 points, I'm bullish," said a Doha-based trader who asked not to be identified.

A short-term target is 8,650-8740, providing first-quarter earnings meet expectations, he said.

"Qatar should move out of the range on (company) results... if results are not as great, then we'll continue trading within a range between 8,400-8,600," the trader added.

Qatar Gas Transport dropped 7.1 percent to its lowest close since Feb. 3 after reaching its ex-dividend date. The firm will pay 1 riyal ($0.27) per share.

Elsewhere, Kuwait's measure fell 0.8 percent, resuming declines ahead of Sunday's deadline for companies to post fourth-quarter earnings.

Many smaller firms often fail to report by the due date, leading the market regulator to halt trading in their shares, so some investors are opting to sell now.

"On the other hand, we expect positive momentum on large cap stocks," said Fouad Darwish, head of brokerage at Global Investment House.

This is because investors will target less risky stocks, he added.

The market climbed to a 26-month peak on Sunday on optimism that companies' fundamentals were improving and hopes the government would revive long-awaited infrastructure projects as part of a stalled multi-billion dollar development plan.

In Egypt, the market advanced 0.4 percent, up for a second day since Tuesday's three-month low.

Orascom Telecom added 1.4 percent and tobacco firm Eastern Co rose 5.9 percent.

National Societe Generale Bank tumbled 9.8 percent, down for a third day since the government said it would levy a 10 percent tax on capital gains made from selling shares to Qatar National Bank.

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