Qatar stocks climb to 2-year high on growth; Dubai shares drop

UPDATE 3: Emirates NBD, the UAE's biggest bank, tumbles six percent, the most since November 2007
Qatar stocks climb to 2-year high on growth; Dubai shares drop
STOCK WATCH: Qatar’s stocks climbed to the highest level in more than two years (Getty Images)
By Reuters
Mon 03 Jan 2011 12:16 PM

Qatar’s stocks climbed to the
highest level in more than two years as nominal gross domestic product
in the oil- and gas-rich Arabian Gulf country increased. Dubai’s gauge
declined for the first time in four days.

Qatar, the second-biggest petrochemicals maker in the Middle East,
gained for a fourth day. Barwa Real Estate Co., the nation’s largest
publicly traded property developer by assets, advanced to the highest
in a week.

The QE Index gained 1.5 percent to 8,872.53, the highest
since September 2008, at the 12:30pm close in Doha. The MSCI
Emerging Markets Index advanced 0.9 percent at 4:35pm in Dubai, set
for the highest close since June 2008.

"Qatar’s GDP
growth came in higher than anticipated," said Omair Ansari, equity
strategist at Gulfmena Alternative Investments in Dubai. "Earnings
upgrades are expected due to the new mandates that will be allocated in
anticipation of the World Cup."

Qatar’s nominal
GDP grew 13 percent in the third quarter from the previous three
months, the state-run statistics authority said on Sunday.

Nominal GDP
soared an annual 21 percent. The $81bn Qatari economy will expand
16 percent in 2010, the world’s fastest-growing, from 8.6 percent in
2009, the International Monetary Fund said in its World Economic
Outlook report in October.

Investors Service estimates Qatar will spend about $57bn over the
next decade for infrastructure developments related to the World Cup.

The country was December 2 awarded the right to host the tournament in
2022. The index has gained 8.4 percent since the announcement was made.

Oil traded at
$92.04 a barrel, near the highest in more than two years, on
speculation the US will sustain an economic recovery into this year,
bolstering consumption in the world’s largest crude user.

The six
nations of the Gulf Cooperation Council, including Qatar and Saudi
Arabia, supply about a fifth of the world’s oil.

Industries Qatar rose 2.6 percent to 143.6 riyals. Barwa gained 1.4 percent to 36.7 riyals.

In Dubai,
shares declined on investor speculation gains following Nakheel’s
progress in renegotiating at least $10.5bn of debt are overdone
given the outlook for profit growth.

Dubai’s DFM
General Index lost 0.3 percent to 1,663.29. The measure rallied 4.1
percent the previous three days, leaving the gauge’s 30 members valued
at an average 15.7 times earnings as of Jan. 2. That was the highest
since November 1 and compared with multiples of 12.6 for the shares in Abu
Dhabi’s measure.

“The market is
going through partial profit taking,” said Mohamed Khaled Hafez,
relationship manager at Prime Emirates LLC in Abu Dhabi. “Nakheel news
accompanied by oil prices were the main reasons for the recent market

Nakheel said on
December 30 it received funds from the Dubai government to repay Islamic
bonds maturing this month. The developer of palm-shaped islands off
Dubai’s coast said January 2 it paid AED3.9bn ($1.1bn) to
trade creditors as the company seeks to renegotiate terms on its loans
and bills.

Emirates NBD, the UAE's biggest bank, tumbled 6 percent, the
most since November 2007. The shares soared 8 percent on Sunday.

Saudi Arabia’s
Tadawul All Share Index added 0.3 percent. Abu Dhabi’s ADX General
Index rose 0.4 percent. Oman’s MSM30 Index advanced 0.3 percent and the
Bloomberg GCC 200 Index of 200 companies in the Arabian Gulf gained 0.5

Bahrain’s measure fell 0.3 percent and Kuwait’s gauge slipped
0.1 percent.

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