Saudi Arabia's stock market rose on Tuesday, as rebounding oil prices lifted all its banks, while the Dubai index was pulled down by a plunge in shares of DAMAC Properties.
Saudi Arabia's index gained 0.9 percent to trade at a near six-month high, with Al Rajhi Bank adding 1.3 percent and the biggest lender National Commercial Bank climbing 1.4 percent.
Riyad Bank rose 1.6 percent. The lender has picked Goldman Sachs to advise on its merger talks with National Commercial Bank, Reuters reported, citing sources familiar with the matter.
Saudi International Petrochemical(Sipchem) fell 1.4 percent. It announced a scheduled maintenance turnaround for its International Diol Plant and said the financial impact of the shutdown will be reflected in its first-quarter results.
In Dubai, the index lost 1.5 percent, weighed down by a 9.8 percent slide in developer DAMAC Properties after BofA Merrill Lynch downgraded the stock to 'underperform' from 'neutral'.
Dubai financial markets continue to face downward pressure, largely coming from real estate companies along with normalization of some of the stocks that benefited from window dressing during the last week of 2018, Sanat Sachar, equity analyst for asset management at Dubai's Al Mal Capital said.
DAMAC's stock on Tuesday experienced its heaviest trading volume since March 2018, with 8.6 million shares changing hands, 5.4 times their 30-day average.
The downgrade resulted in huge selling by foreigners, Sachar said.
BofA said in a research note it was also lowering its 2018 to 2020 earnings per share forecast on DAMAC by an average of 47 percent, citing expectations of weaker booked sales and gross margin.
The company is likely to be pressured by a weak real estate market along with upcoming debt and land payments, BofA added. It also expects DAMAC to cut its dividend to 0.05 dirham per share from 0.15 dirham per share currently.
Dubai's largest lender Emirates NBD declined 2.1 percent and the emirate's biggest developer Emaar Properties dropped 1.5 percent.
The Egypt blue-chip index was up 0.8 percent with Commercial International Bank gaining 2.2 percent and Egyptian Resorts jumping 10 percent.
Qatar's index rose 0.9 percent to touch its highest since March 2017 with 17 of its 20 stocks climbing. Industries Qatar added 2.4 percent and Qatar National Bank increased 1 percent.
In Abu Dhabi, where the index fell 0.3 percent snapping a four-day winning streak, Aldar Properties was down 2 percent while United Arab Emirates' largest lender First Abu Dhabi Bank shed 0.7 percent.
But Abu Dhabi National Energy jumped 9.8 percent. The firm said by the end of 2018 its total investments had reached $30 billion held across 11 countries.
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