Middle East bourses rise as oil remains over $30; Dubai gets boost from results

Bourses in the Middle East advanced on Wednesday as investors nerves were quelled, for now, by Brent prices trading over $30. Many traders and fund managers believe that if Brent trades above $30 - a level investors have been eyeing as a floor - then the region's stock markets may get a temporary boost. Brent traded at $31.61 at 1249 GMT.
Saudi's benchmark index traded up 1.1 percent to 5,699 points, but is about 200 points away from the next resistance level. Technical charts suggested that the index has entered a consolidation phase, Riyad Capital said in a note. "The market was trading at a steady range and managed to hold firm over the critical support level at 5,350," said Shiv Prakash, senior analyst at Abu Dhabi's NBAD Securities. But investors will remain cautious in the near term, he added.
Saudi Basic Industries (SABIC), the largest stock by market value, added 1.5 percent. Other petrochemical stocks also rose. The sub-sector index climbed 1.2 percent. Small and mid-cap insurance stocks, which are favoured by speculative traders, also advanced. Bupa Arabia, a mid-cap medical insurer, jumped 3.7 percent. "Movements in those illiquid stocks reflects short-term sentiment," said a Jeddah-based trader. "If they are up this means traders are calmer, for now."
Dubai's bourse jumped 2.0 percent, with about half of the traded shares advancing more than 2.0 percent. Deyaar Development advanced 4.7 percent after the developer reported a 14 percent rise in fourth-quarter net profit on Tuesday. Profit came in at 101.5 million dirhams ($27.63 million) compared to an analyst's forecast of a net loss of 28.9 million dirhams.
Rival developer Emaar Properties traded up 2.0 percent. Dubai Islamic Bank (DIB), jumped 5.3 percent after it posted a 62.8 percent increase in fourth-quarter net profit on Wednesday. The United Arab Emirates largest Islamic lender's bottom line came in at 1.15 billion dirhams ($313.1 million) compared to an HSBC analyst forecast of 915 million dirhams. DIB also proposed a higher cash dividend for 2015. Competitors listed on Abu Dhabi's exchange, Abu Dhabi Islamic Bank and Abu Dhabi Commercial Bank, which have not yet reported quarterly earnings, garnered momentum after DIB's results appeared to have lifted investors' optimism in the sector. Both lenders surged over 6.0 percent.
The banking sector helped Abu Dhabi's benckmark recover earlier losses. The exchange edged up 0.7 percent to 3,828 points, moving further away from a 28-month low hit last week. Dana Gas, the natural gas explorer, closed 5.0 percent higher, trimming its losses in 2016 to 19.6 percent. The index has fallen 11.1 percent since the start of the year.
In Qatar, the exchange rose 2.6 percent as energy-linked companies firmed. Gulf International Services and Qatar Gas Transport Co both advanced more than 3 percent. Vodafone Qatar rose 1.1 percent. The telecom operator plans to review its costs in an effort to maintain margins after reporting widening losses for a fifth straight quarter on Tuesday.
In Egypt, the main index added 1.1 percent, its third session of gains. But volumes were modest and below the weekly average. Egyptian and non-Egyptian Arab traders were net buyers while foreign investors were net sellers, bourse data showed. Orascom Telecom and Orascom Construction added 1.8 and 3.1 percent respectively.