“Saudi Arabia is the best performing market in the region. At the moment, we don’t have any news flow and we are seeing profit taking in the index,” said Matthew Wakeman, managing director for cash and equity-linked trading at EFG-Hermes.
Middle East markets failed to fully capitalize on a spike in oil prices and positive sentiment in global stock markets.
US oil futures hit an 18-month high on Monday, climbing toward $86 per barrel on expectations of faster-than-expected economic recovery and increasing demand for fuel and Asian stocks rose on strong US jobs data.
Dubai fell for a third session in four as investors sold off bluechip stocks in the absence of any new catalyst post a Dubai World-inspired rally.
“Markets have technically priced in the Dubai World news. Investors are now trying to figure out what is next now for markets to move ahead,” said Robert McKinnon, chief investment officer at ASAS Capital.
The index dropped 0.7 percent to 1,837 points. Emaar Properties fell 0.7 percent and Emirates NBD closed down 1.7 percent.
Shuaa Capital, down about 4 percent intraday, ended 2 percent higher after saying it would not suffer a major setback as a result of Kuwait’s Gulfinvest defaulting on a 200 million dirham ($54.47 million) loan to Abu Dhabi Commercial Bank (ADCB).
Abu Dhabi’s index dropped 0.8 percent to touch a two-week low. ADCB fell 3.7 percent.
“I would like to see a healthy correction. Valuations have gone a bit ahead of themselves and markets need to take a breather now,” McKinnon said.
Qatar’s index touched a six-month high, helped by property stocks. Barwa Real Estate rose 2.1 percent, while Qatar Real Estate (Alaqaria) gain 2.4 percent.
In Kuwait, Boubyan Bank was the most active stock, rising 7.4 percent. The index rose 0.2 percent.
“Boubyan is going up, but there’s no clarity as to who the buyers are,” said a Kuwait-based trader who asked not to be identified.
Boubyan’s stock has gained more than 20 percent since National Bank of Kuwait said on March 28 it received central bank approval to buy up to an additional 20 percent stake in the Islamic lender.
Oman’s index hit a 17-month high, with banks leading gainers as traders reinvested dividends into the market.
“We expect dividend reinvestments to maintain (the) healthy momentum in Oman,” said Ajeev Gopinath, assistant vice president, asset management at Gulf Baader Capital Markets.
He said dividends from index constituents in March amounted to 217 million rials ($563.6 million), compared to a monthly turnover of 125 million rials.”
