Petrochemicals lead Tadawul index higher

Saudi Arabia’s petrochemical stocks rallied on Wednesday after Brent crude oil firmed over $51 a barrel.
Tadawul All-Share Index closed up 1.1 percent as the petrochemical sub-index rose 3.4 percent with all 14 listed producers advancing. Yanbu National Petrochemicals (Yansab) jumped 5.9 percent to SR46.80 and National Petrochemical surged 8.2 percent to SR15.15.
Analysts at NCB Capital said in a note that Yansab was one of their top picks in the sector because of superior efficiency and low debt levels. They maintained an “overweight” rating on the stock with a price target of SR50.40.
Analysts at Bahrain’s SICO said: “Yansab is in a strong position as it is now a ‘cash cow’ with no near-term large capex requirements. Double-digit cash flow yield should support the high single-digit dividend yield.” They rate the stock a “buy” with a target of SR53.00.
NCB also upgraded National Petrochemical to “overweight” with a price target of SR17.30, citing greater efficiency following a two-month shutdown and attractive valuations. SICO upgraded the stock too, to “buy” with a target of SR19.00.
Saudi Arabia’s three top telecommunications stocks were mixed in a second straight session of heavy trade after the government said it would provide operators with “unified licenses” allowing them to offer a full range of services.
Zain Saudi rose 4.7 percent, taking its gain over two days to 14.8 percent. Saudi Telecom retreated 2.3 percent and Mobily fell 0.8 percent.
Builder Al-Khodari jumped 4.0 percent in active trade after it said it had signed a contract with miner Ma’aden to construct an aluminum producing facility for SR49 million ($13.1 million).
Dubai’s index pulled back 1.3 percent to 3,362 points, its lowest close in 12 weeks. 
It turned technically bearish on Monday when it broke technical support on the August and September lows of 3,430-3,442 points, which became immediate resistance. 
Losers outnumbered gainers 23 to three.
Builder Drake and Scull dropped 3.8 percent and DXB Entertainments, which is due to open its theme parks in Dubai this month, lost 1.3 percent.
Banks weighed on Abu Dhabi’s stock index, which closed 0.4 percent lower. Union National Bank retreated 3.7 percent and First Gulf Bank lost 0.9 percent.
Qatar’s index edged down 0.2 percent. Mobile operator Ooredoo led the falls, closing down 0.8 percent.
Kuwait’s National Investments Co. jumped 5.7 percent after it said it was appointed to execute the purchase of a majority stake in Kuwait Food Co. on behalf of one of its clients. 
Kuwait Food rose 0.8 percent, and the general market index edged up 0.04 percent.

Source: Arab News