Qatari stocks rose on Tuesday amid expectations money will flow into the market when the index compiler FTSE promotes it to emerging-market status from frontier market. Most other Gulf markets gave up early gains to close lower and Dubai pulled back from technical resistance. FTSE, which will promote Qatar on September 19, announced on Monday some of the criteria which it will use to choose individual Qatari stocks for its index, including liquidity requirements.
Investment bank EFG Hermes said that as a result, it had raised its prediction for FTSE-related fund inflows next month to $550 million from $289 million. Three stocks that had looked unlikely to be chosen - Qatar National Bank (QNB), Qatar Insurance and Qatar Navigation - were now likely to enter the index, it said.
Qatar's main stock index jumped 2.2 percent to a nine-month closing higher of 11,371 points in the heaviest trade since mid-March as QNB and Qatar Navigation both surged 6.7 percent and Qatar Insurance gained 3.5 percent.
Other major Gulf markets failed to hold onto early gains, however, despite a further rise of Brent crude oil futures to $48.74 per barrel, their highest since July 7. Dubai's index fell 0.4 percent to 3,587 points, retreating from technical resistance at its April peak of 3,605 points. Emaar Properties, which had led the market up in recent days, pulled back 1.3 percent.
Abu Dhabi also lost 0.4 percent as banks fell, although Aldar Properties, the most heavily traded stock, climbed 2.1 percent. Saudi Arabia's index fell 0.5 percent in a broad-based decline, with losers outnumbering gainers 119 to 30. Zain Saudi Arabia outperformed, closing flat, after saying it would save 175 million riyals ($46.7 million) by using a Chinese bank to refinance a 2.25 billion riyal loan that it had secured just two months ago.
In Oman, two cement companies outperformed after they said they planned to set up a new plant in a joint venture with the government authority developing the country's Duqm special economic zone. Oman Cement Co rose 2.6 percent and Raysut Cement Co added 2.1 percent.
In Egypt, the index dropped 0.8 percent on profit-taking. It had risen for most of the past three weeks in response to Egypt's talks with the International Monetary Fund for a loan. Nine of the 10 most heavily trade stocks retreated. Commercial International Bank, a favourite of foreign investors, slipped 0.6 percent to 51.50 Egyptian pounds after climbing 23 percent since the end of June. The median price target for the stock of 14 analysts surveyed by Thomson Reuters is 51 pounds.
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