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Tue 18 Sep 2012 10:47 AM

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Gulf seen tracking global lead; profit-taking expected

Batelco in talks with Cable & Wireless Communications over $1bn deal

Gulf seen tracking global lead; profit-taking expected
Gulf markets are seen following the global lead until local catalysts and third-quarter earnings start to impact in the coming weeks.

Gulf markets are seen following the global lead until local catalysts and third-quarter earnings start to impact in the coming weeks, with short-term investors set to book recent gains.

Asian shares retreated from four-month highs on Tuesday, while gold and copper eased, as markets paused from sharp gains inspired by the Federal Reserve's aggressive stimulus and turned instead to concerns about the growth slowdown in China.

UAE markets slipped on Monday from the previous session's Fed-spurred multi-month highs as investor caution returned while other Gulf bourses were mixed.

"It's all about international news still - the policy picture has started to improve, giving investors a lot of confidence," says Amer Khan, fund manager at Shuaa Asset Management.

"For near-term traders, there will be profit taking along the way. There is a lot of retail activity in these markets and I wouldn't be surprised to see some prices come off a bit."

Elsewhere, shares in Bahrain Telecommunications Co will be in focus after sources told Reuters the firm is in talks with Cable & Wireless Communications to buy its assets in Monaco and a host of island nations, a deal potentially worth around $1bn.

In Saudi Arabia, Credit Suisse started Riyad Bank Banque Saudi Fransi and Al Rajhi Bank with outperform ratings. It rated Arab National Bank and Samba Financial Group as underperforming stocks.

Arabian Business: why we're going behind a paywall