Oil price hits Saudi stock market; Dubai hurt by property stocks

An oil price slump hit Saudi stocks yesterday while the Dubai exchange gave up its early gains due to renewed selling of property stocks. Oil prices fell following comments from the White House that the leader of Saudi Arabia promised President Donald Trump that he can raise oil production if needed. The Saudi index fell 0.8% to 8,275 points, with petrochemicals firm Sabic falling 1.6%, while refiner Petro Rabigh also dropped 1.6%. Selling went beyond energy, hitting financial stocks such as Samba Financial Group which dropped almost 2%. Despite the slide, the Saudi index is still up 14% so far this year, fuelled by fund flows ahead of MSCI’s decision to add Riyadh to its emerging market benchmark.
A man walks past the entrance to the Saudi Stock Exchange (file). The Saudi index fell 0.8% to 8,275 points yesterday.

However, Dubai was hit by fresh selling, which had shown some recovery during the last two sessions after snapping an 11-day losing streak on Thursday. Investors remain concerned about exposure of Dubai-listed companies to troubled private equity firm Abraaj, which this month filed for provisional liquidation. The Dubai index dropped 1.2% to 2,829 points, hit by a 1.9% drop in Damac Properties and a 1.6% slump in Emaar Properties. Contractor Drake & Scull continued to weigh on the market, falling almost 9.9%, bringing its year-to-date losses to more than 70%.

The stock has been hit by concerns about its business outlook, constant rumours on whether some of its top shareholders are committed to the stock and ongoing investigations against its previous management. In Abu Dhabi, First Abu Dhabi Bank dropped 2% and Eshraq Properties slumped 9.4% as investors took profit after the stock’s jump a day earlier. The gains came after the firm had said it was seeking to deploy “excess liquidity” in investments across the United Arab Emirates, after dropping merger plans with Abu Dhabi developer Reem Investments. Abu Dhabi’s index closed almost 1% lower to 4,577 points. Elsewhere in the Gulf, the Kuwait index added 0.2% to 4,926 points, the Bahrain index was down 0.3% to 1,310 points and the Oman index fell 0.1% to 4,556 points, whereas the Egypt index was flat at 16,362 points.

Sources and photo-credits: Reuters, Gulf Times