Qatar’s bourse fell to a three-week low on Thursday as weak third-quarter earnings prompted many investors to look elsewhere for buying opportunities; other regional markets rose.
Shares in heavyweight Qatar National Bank fell 1.7 percent to 160.0 riyals, their fifth consecutive loss, nearing technical support at the September low of 158.0 riyals.
Earlier this month, the lender posted a 14.3 percent rise in third-quarter net profit that slightly missed analysts’ forecasts.
“The results so far haven’t supported the bullish market outlook,” said Ahmed Shehada, head of trading at QNB Financial Services. “Institutions are selling across the board but there is selective buying on some names.
“The macro fundamentals remain intact and if we see positive earnings surprises on companies that haven’t reported yet, we could see buyers return.”
Telecommunications operator Ooredoo lost 1.4 percent and Masraf al-Rayan shed 0.5 percent. The Islamic bank has not yet announced third-quarter earnings; analysts polled by Reuters on average expect it to post a third-quarter profit of 415 million riyals ($114 million), which would be up 15.9 percent from a year earlier.
The Qatar index retreated 0.4 percent to 9,652 points, its lowest close since Oct. 1. Daily trading volume fell to its lowest since Sept. 22.
Shehada said the index could drop to 9,410 points if it broke below the 9,570 level, which is roughly where it bottomed at the end of September.
One uncertainty for the market is the fate of planned IPOs. Qatar Petroleum picked two banks last month to help arrange an initial public offer of shares in one of its units, an issue which could be worth around 3.2 billion riyals.
But it is now unclear if the IPO will go ahead before the end of this year. Plans to list Doha Global Investment Co, backed by assets from Qatar’s sovereign wealth fund, appear to have been postponed indefinitely.
In Saudi Arabia, food firm Savola Group climbed 1.3 percent to a two-month high after posting estimate-beating earnings. The firm’s third-quarter profit rose 12.9 percent, and it proposed a quarterly dividend of 0.5 riyal.
Petrochemicals supported the market after a few firms in the sector posted results this week which came in ahead of estimates. That bodes well for Saudi Basic Industries Corp (SABIC), the parent of two such companies, which is to report on Sunday. SABIC shares rose 0.7 percent to an 18-month high of 104.75 riyals; they face no chart resistance before the 2012 peak of 110.00 riyals.
“The market is in an anticipation mode and all eyes are on SABIC,” said Mohammad Omran, president of Riyadh-based private firm Gulf Centre for Financial Consultancy. “There is a sense of optimism on the sector which we haven’t seen in a long time.”
The benchmark index advanced 0.3 percent to 8,171 points, a fresh two-month high.
Omran said petrochemical shares were likely to support the market in coming months and help lift the index to close the year above the August peak of 8,223 points.
In the United Arab Emirates, Abu Dhabi Commercial Bank (ADCB) gained 1.0 percent after posting quarterly earnings that beat estimates by a large margin.
The stock is up 64.1 percent year-to-data, outperforming the wider benchmark; analysts say much of the positive sentiment is already priced in. Abu Dhabi’s index added 0.2 percent, up 47.6 percent in 2013.
Dubai’s bourse added 0.3 percent, trading near Tuesday’s five-year high.
Emaar Properties gained 0.3 percent before announcing third-quarter earnings; its profit surged 50 percent, handily beating estimates.
Dubai’s largest bank, Emirates NBD, fell 0.7 percent after it posted a 21 percent increase in third-quarter net profit but fell short of analysts’ expectations because of a 50 percent spike in bad loan provisions.
Investors generally did not see the results as a sign that the recovery of Dubai’s banking sector and property market was in doubt; instead, ENBD may merely have wanted to clear bad loans from its books to give new chief executive Shayne Nelson a clean start when he takes over next year.
Shares in Telecom Egypt fell 1.9 percent after the firm said in a bourse statement that it had not received any offer from Vodafone to buy Telecom Egypt’s stake in Vodafone Egypt.
The stock jumped to multi-month highs on Tuesday after Bloomberg reported that Vodafone was interested in buying the stake, but it has now dropped back to its previous levels.
* The index fell 0.4 percent to 9,652 points.
* The index climbed 0.3 percent to 8,171 points.
* The index climbed 0.3 percent to 2,910 points.
* The index gained 0.2 percent to 3,882 points.
* The index climbed 0.3 percent to 6,668 points.
* The index rose 0.6 percent to 7,954 points.
* The index advanced 0.2 percent to 1,203 points.