Gulf stocks rebound a bit after slide

Dubai : Gulf stock markets rebounded slightly yesterday after a jittery week in which most dropped because of concern about Saudi Arabia’s anti-corruption purge, which could reduce Saudi fund flows to the region.

The Saudi stock index spent most of the day lower before closing 0.3 per cent higher. Similar trading patterns were seen every day this week after authorities announced the arrest of dozens of senior officials and businessmen in the investigation and froze over 1,700 domestic bank accounts.

Wealthy Saudi individuals, fearful that they could be implicated in the probe, have been dumping stocks to raise cash, in some cases intending to move the money out of the country, fund managers said.

This has pushed the market down in intra-day trade but state-linked funds have bought stocks in order to prevent a panic, pushing the market back up towards the close.

Advancing stocks outnumbered decliners by 131 to 42 on Thursday. Real estate developer Dar Al Arkan, the most heavily traded stock, jumped its 10pc daily limit in its heaviest trade since July after reporting third-quarter net profit almost doubled from a year ago to 209.6 million riyals ($55.9 million), as sales more than doubled.

In a sign that the impact of the corruption crackdown might be fading, stocks in companies related to people implicated in it regained some strength.

Al Tayyar Travel, whose founder Nasser bin Aqeel al-Tayyar has been arrested, rose 2.7pc after plunging 22pc in the previous three days.

Red Sea International, whose chairman Amr al-Dabbagh was detained, gained 0.6pc. Kingdom Holding , the investment vehicle of Prince Alwaleed bin Talal, who was also detained, rebounded 1.2pc.

Most other Gulf bourses rose “Oil prices are the main reason for the rebound - oil is close to $65 a barrel and could hit $70, which is good for the whole region,” said Vijay Valecha, chief market analyst at Century Financial Brokers in the UAE. Dubai’s index gained 1.0pc as real estate developers, which sank earlier this week, recovered. Emaar Properties added 1.3pc and DAMAC Properties gained 5.0pc.

Amusement park operator DXB Entertainments rose 2.2pc after it said it would obtain a subordinated loan of 700 million dirhams ($191 million) from majority shareholder Meraas.

Abu Dhabi’s index edged up 0.2pc but Abu Dhabi National Energy Co sank 3.1pc after reporting a third-quarter loss attributable to shareholders of 194 million dirhams ($52.9 million) versus a year-ago loss of 524 million dirhams. In the second quarter, it had posted a tiny profit.

Egypt gained 1.0pc. Investment firm Qalaa Holdings surged 7.3pc in its heaviest volume since it listed in 2009. The company said it had sold its entire stake in Dice Sport & Casual Wear for about 300 million Egyptian pounds ($17.0 million).