Sell off in Dubai pushes benchmark lower, as sentiment is affected by fears of spreading euro zone crisis
A sell off in Dubai pushed the benchmark to its lowest level
in July, as sentiment was affected by fears of spreading euro zone crisis,
while new rules by Kuwait's market regulator weighed on the Gulf state's index.
Dubai's index DFM declined 1.2 percent to 1,549 points, its
lowest level since June 29.
Losers outnumbered gainers 17 to two.
World stocks hit one-week lows on Monday and the euro slid
across the board as intensifying concerns that Italy could be the next victim
of the euro zone debt crisis prompted an emergency meeting of top European
"Today's performance is due to external factors, mainly
contributed by global markets and spread of debt crisis in Europe," said Marwan
Shurrab, vice-president and chief trader at Gulfmena Alternative Investments.
"Dubai's stocks, fundamentally, are trading at strong
Abu Dhabi's benchmark rose 0.1 percent to 2,725 points.
Property stocks helped with Aldar Properties and Sorouh Real Estate gaining 0.8
and 1.5 percent respectively.
Elsewhere, Kuwait's index declined 0.5 percent to 6,184
points, down 11.1 percent so far in 2011.
"We have so many negative effects on the market and
there is no catalyst," said Badr Al Ghanim, Global Investment House
vice-president of asset management.
The newly formed Capital Markets Authority has given a set
of new rules to be implemented, including a requirement of separate licences
for investment firms to operate their lending and investment businesses.
"Everyone is having problems implementing these laws.
Even Q2 results will be below expectations," al-Ghanim added.
Seven of the ten largest stocks were down, with National
Bank of Kuwait falling 1.7 percent and Zain down 2 percent.
In Qatar, the benchmark gained 0.1 percent to 8,497 points.
0923 GMT - Oman Telecommunications Co (Omantel) headed
losers as Muscat's index ended lower for a first session in eight, with
investors booking profits as they await bluechips' second-quarter earnings.
Omantel fell 1.6 percent as less than 100,000 shares trade.
The former monopoly's second-quarter profit is forecast to drop 14 percent.
"Omantel's volumes are very small, so today's move
doesn't indicate much," said Adel Nasr, United Securities brokerage
"Although we expect Omantel's profits will fall due to
increased competition, we believe it will continue paying a 100 percent
dividend, providing one of the best dividend yields in the region, so the stock
should rebound soon."
Bank Sohar was the most active stock, ending flat to equal
Sunday's seven-week high after the lender's quarterly profit rose 14.8 percent,
according to a statement on the bourse website.
"Bank Sohar's results were better than expectations, as
were results from some smaller Oman companies, but we're still waiting for
bluechips earnings and if these are in with estimates or higher I think the
market will rally," added Nasr.
"There has been a huge discount on stocks over the past
few months, so if results are good more people will return to the market."
The index dropped 0.1 percent to 5,985 points, easing from
Sunday's two-week high and taking its 2011 losses to 11.4 percent.