Font Size

- Aa +

Tue 15 May 2012 10:29 AM

Font Size

- Aa +

Saudi market my rebound; Dana Gas in focus

Regional investors are taking the global risk-off lead on continuing euro zone concerns

Saudi market my rebound; Dana Gas in focus
UAE stock exchange, Dubai bourse

Regional investors are taking the global risk-off lead on continuing euro zone concerns, but Saudi Arabia's bourse may rebound on Tuesday, from its 12-week low, as it nears a key technical level where bargain hunters return.

The Saudi bourse closed at 68 basis points above 7,000 in the previous session, which is seen as a psychological level by investors and is likely to provide a strong support to the index.

"Overall, the market is taking its cue from events globally and that will continue over the short-term but there will be some psychological buying at 7,000," says Muhammad Faisal Potrik, research analyst at Riyad Capital. "You can see bargain hunters come in."

Saudi Arabia's benchmark has lost 6.5 percent so far this month, tracking declines on global markets on concerns over a worsening euro zone debt crisis as well as slowing global growth.

Other local markets have also declined as investors cut risk across the region.

Bahrain-based SICO Investment Bank cut National Industrialisation Co's price target to SAR40 from SAR44 on Monday, with an 'add' rating.

The petrochemical firm's shares fell 1.5 percent on Monday to close at SAR33.1.

In the UAE, Dana Gas will be in focus after it reported a first-quarter net profit of AED206m, up from AED92m in the year-earlier period.

It beat EFG Hermes' estimate profit of AED146m.

Dubai's Drake and Scull may come under selling pressure after its profit trailed estimates. It's quarterly net income was AED37.6m, behind an average estimate of AED56.5m.

Elsewhere, Asian shares were lower on Tuesday and global stocks slid overnight on worries about a potential exit by Greece from the euro zone.

Brent crude was down by US$0.54 to US$111.03 a barrel by 0500 GMT.