Egypt's bourse ended higher on Wednesday as Mobinil rebounded from declines on talk of potential shareholding changes, while most Gulf markets gained in lacklustre trade. Egypt's index gained 2.3 percent on heavy buying of Mobinil after some traders said Egyptian telecoms magnate Naguib Sawiris might be preparing to sell shares in the mobile operator. He denied this in comments to Reuters.
Mobinil, whose shares have fallen 44 percent this year, touching its lowest level since 2004 on August 9 at 86 pounds, was the biggest gainer on the index, up 10 percent. Parent company Orascom Telecom gained 5.2 percent. Mobinil is a joint venture between France Telecom and Orascom, a company founded by Sawiris in which Russia's Vimpelcom acquired a controlling stake in March. Sawiris's family also has a stake in Mobinil.
"The stock is really distressed and there's massive buying in the market. Everyone wanted to buy it at 86 pounds," said Ashraf Akhnoukh of CIBC brokerage. "What we're seeing today could be the equivalent of two months' volume." Saudi Basic Industries Corp (SABIC) gained 1.9 percent, lifting the index 0.6 percent, after saying it is planning a $1 billion-plus facility in China. Despite regional gains, traders said Gulf investors were unconvinced by efforts to resolve the European debt crisis.
France and Germany unveiled far-reaching plans on Tuesday for closer eurozone integration but they disappointed investors by ruling out common euro bond issuance for now. In Qatar, banks helped lift the benchmark 0.8 percent to a nine-day high, but volumes were low as investors waited for news to trigger buying. Qatar National Bank climbed 0.6 percent, Commercial Bank of Qatar gained 3.4 percent and Qatar Islamic Bank rose 1.4 percent.
In Oman, oil services firm Renaissance Services dropped 6.3 percent, before its trading was halted. The company's shares have dropped by the maximum allowed 10 percent for two days to an all time low after it reported fraud at its unit Topaz, and saw a 77-percent drop in first-half net profit.
Banks helped index rise 0.6 percent. Bank Muscat rose 0.6 percent, National Bank of Oman climbed 0.7 percent and Bank Sohar gained 2.2 percent. "The market saw a strong support today from local pension funds and retail clients came back with a focus on banking sector," said Adel Nasr, United Securities brokerage manager. Kuwait's index slipped 0.2 percent, while markets in Dubai and Abu Dhabi ended nearly flat.
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