Banking stocks drag Tadawul index down

Gulf stock markets diverged on Monday, with the two main bourses in the United Arab Emirates recovering from losses in the previous session, while banks weighed on Saudi Arabia's index.

Riyadh's benchmark Tadawul All-Share Index closed 0.1 percent lower at 6,516 points, extending Sunday's 1.2 percent decline, as the banking sub-index sagged 0.7 percent. Samba Financial Group fell 0.7 percent.
But the market's other major sector, petrochemicals, edged up after Sahara Petrochemical reported that second-quarter net profit soared 746 percent to SR96.4 million ($25.7 million), much higher than NCB Capital's forecast of SR66.8 million.
"The variance in estimates is due to lower-than-expected losses at Sahara's acrylic facility and at its joint venture with Maaden, SAMAPCO, and lower operating expenses," NCB Capital said in a note. Sahara also said profit jumped because some of its plants experienced scheduled shut-downs in the year-earlier period.
Shares in Sahara rose 1.8 percent to SR11.59; NCB has a "neutral" rating on the stock with a price target of SR10.00. The biggest petrochemical producer, Saudi Basic Industries Corp., which is expected to report earnings this week, added 0.9 percent.
Some insurers rose after posting results. Saudi United Cooperative Insurance jumped 6.8 percent after it swung to a net profit before zakat (tax) of 30.6 million riyals from a loss of SR40.4 million in the corresponding quarter of 2015. But the insurance sector sub-index dropped 0.8 percent.
Elsewhere in the Gulf, Abu Dhabi's index climbed 1.0 percent to 4,614 points with real estate developer and property rental manager Eshraq Properties adding 1.4 percent after the company said it had appointed Jassim Alseddiqi as chairman.
Alseddiqi, also chief executive of Abu Dhabi Financial Group, said he would look to expand Eshraq through strategic partnerships.
However, real estate advisory firm JLL reported that after 18 months of relatively stable conditions, Abu Dhabi's property market was starting to weaken.
"During Q2, 2016, we have started to see the first signs of a downward trend as the decline in the oil sector, reduced government spending and weak sentiment continues," David Dudley, head of JLL's Abu Dhabi office, said in a report.
Aldar Properties, the largest listed real estate developer in Abu Dhabi, edged down 0.4 percent. The company is expected to report earnings on Aug. 2.
Dubai's index recovered from its 0.8 percent decline on Sunday and added 1.1 percent to 3,555 points, but trading volume was below the average of the last 10 days.
Emaar Properties jumped 2.2 percent to 7.00 dirhams, retesting major technical resistance on its October peak of 7.01 dirhams.
Qatar's index rose 0.7 percent to 10,554 points, with Qatar Gas Transport, a constituent of the MSCI emerging market index, rising by that margin.
In Egypt, the main index added 0.7 percent to 7,518 points in thin trade with about three-fifths of traded stocks advancing.
Shares favored by international funds fared well with Global Telecom Holding jumping 1.9 percent. The largest listed lender, Commercial International Bank, rose 1.6 percent.

Source: Arab News