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Gulf markets dip, tracking oil; Egypt extends gains

DUBAI, May 24, 2015

Most Gulf stock markets slipped on Sunday after oil prices fell, while Egyptian equities extended gains following the delay of an unpopular capital gains tax.

Brent oil fell $1.17, or 1.8 per cent, to $65.37 a barrel on Friday, declining 2.1 per cent on the week as a rallying dollar and profit-taking ahead of a long US holiday weekend cut short a two-day rally.

Petrochemicals giant Saudi Basic Industries, whose profits are sensitive to oil prices, dropped 2.5 per cent and was the main drag on Saudi Arabia's index which lost 0.4 per cent.

Other blue chips were also mostly weak as investor sentiment appeared to suffer following an Islamic State suicide bomb attack. The blast killed 21 worshippers on Friday in a packed Shi'ite mosque in eastern Saudi Arabia in one of the deadliest assaults in recent years in the largest Gulf Arab country.

But Bahri, the exclusive oil-shipper for Saudi Aramco, rose 1.9 per cent to a new all-time closing high of 54.50 riyals after saying on Sunday it had signed a deal to buy five very large crude tankers from ship builders Hyundai Heavy Industries.

Hyundai will build the tankers and deliver them to Bahri in 2017. Bahri also has an option to buy five more. It did not say how much it would pay for the tankers, although each will have a capacity of 300,000 deadweight tonnage.

Dubai's index fell 1.7 per cent as most stocks declined. Builder Arabtec dropped 3.3 per cent after Egyptian newspaper Al Mal reported, citing an anonymous source, that a planned deal between the firm and the Cairo government to build 1 million housing units in Egypt has fallen through.

Neither the Egyptian government nor Arabtec were available for immediate comment on the project whose value was estimated at 280 billion Egyptian pounds ($36.70 billion).

Retail and entertainment startup Marka was one of just a handful of gainers, rising 1.6 per cent after it said in a statement it expected the earnings of restaurant chain Reem Al Bawadi, which it bought this month, to grow at a rate of more than 25 per cent annually in coming years. Marka also said it planned three more acquisitions in 2015.

Abu Dhabi's bourse dropped 0.7 percent as large lenders National Bank of Abu Dhabi and First Gulf Bank fell 0.9 and 1.0 percent respectively.

Qatar's benchmark was flat, while Ezdan Holding , which is likely to see passive inflows funds this week as it joins MSCI's emerging markets index, jumped 2.4 percent, offsetting losses in other stocks.

Egypt's index rose 1.5 percent to a fresh seven-week closing high of 9,122 points, extending the broad rally which started last week when the Cairo government put on hold its plan to introduce a 10 percent capital gains tax.

For a second session in a row, the Cairo benchmark closed above technical resistance at 8,860 points, its early May peak, triggering a minor double bottom formed by the April and May lows and pointing up to around 9,400 points. The index rose 1.5 percent to 9,122 points.-Reuters




Tags: Dubai | stocks | Oil |

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