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Drake Scull helps lift Emirates bourse

Published: Updated:
Dubai-listed Drake and Scull (DSI) helps lift the Emirate’s bourse after the firm’s joint venture won a new contract in Saudi Arabia valued at 2.7 billion riyals ($719.96 million).

Shares in DSI rise 1.6 percent. The contractor and engineering firm, along with Arabian Construction co. will build the third phase of the Jabal Omar development in Mecca.

Other property-related stocks also gain. Emaar Properties and builder Arabtec climb 0.5 and 0.4 percent respectively.

Dubai’s benchmark advances 0.5 percent to 1,595 points, down 1 percent so far in December.

“The focus is now back again to the downside and we are waiting for the downward break of 1,575 support level, which will complete a bearish trend reversal pattern to go short,” MENA Corp says in a note. Only the upward break of 1,630 would cancel the bearish scenario.”

The market however, has gained 17.5 percent year-to-date.

Abu Dhabi’s bourse also rose, helped by a slight recovery in heavyweight Etisalat. Shares in the telecom operator gain 3 percent, halting two days of sharp declines, spurred after the government set new royalty rates or taxes for operators.

Dana Gas rises 4.3 percent, heading for its third gain since it reached an agreement with credit holders on restructured sukuk terms.

Abu Dhabi’s benchmark edges up 0.3 percent to 2,613 points.
Elsewhere, Kuwait’s index ticks up 0.1 percent to 5,938 points, while Oman's benchmark trades near-flat.

Shares in Egypt’s National Societe Generale Bank may trade lower after parent Societe Generale’s deal to sell its majority stake to Qatar National Bank (QNB) valued the bank at less than its market price.

QNB’s deal valued the entire bank at $2.6 billion, which is less than the bank's current market value of about $2.7 billion, according to Reuters’ data. Shares in NSGB will likely trade lower to match the deal value.

“The QNB deal prices NSGB shares at about 35.6 pounds - in general, it’s very good for QNB because most of the analysts were looking at a price of more than 45 pounds,” says Ali Adou, portfolio manager at The National Investor. “QNB is proving their policy that they will not overpay for assets.”

NSGB shares closed at 39.35 pounds on Wednesday.

Egypt’s liberal and secular opposition has urged its supporters to vote down a divisive constitution put forward by Islamists, and set conditions for taking part in the referendum that will be hard for organizers to meet.

Foreign buying lifted Egypt’s bourse to a three-week high on Wednesday, helping the index recover most of the losses sparked by President Mohamed Mursi’s decree last month that expanded his powers and triggered a political crisis.

“If you look at Egypt in the next 2 years, there are ample opportunities, if you’re a long-term investor. You’re bound to have bumps with the democracy but it’s positive in general- in terms of buying opportunities and valuations,’ Adou says.

In UAE, contractor Drake and Scull International may trade higher after saying its joint venture in Saudi Arabia was awarded a 2.7 billion riyal ($719.96 million) contract.

Global lead may support Gulf sentiment as Asian shares extended gains for a seventh day on Thursday, after the U.S. Federal Reserve took new stimulus steps to bolster the economy.