DUBAI: Regional markets were muted Wednesday with profit-taking weighing on some bourses following strong early-week gains and dim global backdrop adding pressure as investors await cues from earnings.
Saudi Arabia’s Jarir Marketing jumped 6.4 percent to an all-time high after the firm’s board recommended a total dividend payout of 150 million riyals ($40 million) for the third quarter and one bonus share for every two held.
Saudi Arabia’s benchmark edged up 0.09 percent to a fresh two-month high; gains in retail shares were offset by profit-taking in petrochemical and banking shares.
Elsewhere, Cairo’s benchmark index retreated 0.6 percent, snapping a six-session winning streak. It dipped from a 33-month high hit in the previous session after the government announced plans to increase spending in an economic stimulus package by a third to 29.6 billion Egyptian pounds ($4.3 billion).
“The market has been strong this week and some weakness late on Tuesday triggered profit-taking,” said Mohamed Radwan, director of international sales at Pharos Securities.
Shares in Arab Cotton Ginning and Telecom Egypt dropped 1.2 and 3.5 percent respectively.
In Kuwait, the bourse gained 0.4 percent to 7,906 points, its second gain in four sessions and approaching the key 8,000 level.
“Liquidity is coming back in the market, and while people are usually reluctant when they are waiting for corporate reportings, the turnover numbers are an encouraging indicator,” said Fouad Darwish, head of brokerage services at Global Investment. “Liquidity is what is going to take us above the 8,000 psychological barrier.
“Earnings are expected to be better and will set the pace for the following quarters,” he said.
Later Wednesday, the country’s largest lender National Bank of Kuwait reported a 35.3 percent fall in its third-quarter net profit, Reuters calculations show, mainly due to a one-off gain recorded in the year-ago period. The profit slightly missed analysts’ average forecast.
Trading, however, was focused on mid-caps. Warba Bank, which listed on Sept. 3, gained 2.8 percent to its highest level since Sept. 11. Gulf Finance House fell 1.1 percent.
In the United Arab Emirates, Dubai’s index retreated 0.8 percent to 2,902 points, easing off a five-year high in its second decline in last seven sessions.
The index faced resistance near the psychologically important level of 3,000 points.
Small-caps led declines with Gulf Navigation and Union Properties each shedding 0.4 percent.
Ali Adou, portfolio manager at The National Investor, said the market was due for a correction after the bet on Dubai hosting the World Expo 2020.
“The expo is already priced in. Lately, many investors have been speculating on small cap real estate names. The next catalyst is 3rd and 4th quarter earnings,” he said.
Abu Dhabi’s measure climbed 0.3 percent, extending 2013 gains to 47.2 percent and benefiting from optimism for Dubai’s expo bid. Daily trading volumes fell to their lowest in two months as investors sit on the sidelines ahead of third-quarter earnings.
In Qatar, the index slipped 0.3 percent but was trapped in tight trading.
On global markets, concerns over tighter Chinese monetary policy and worries a new checkup of eurozone banks could prove costly for its weaker members halted a rally spurred by hopes of extended U.S. stimulus.