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Saudi, Egypt edge down in early trade after oil weakens

Published: Updated:

Stock markets in Saudi Arabia and Egypt slipped in early trade on Sunday, erasing some of their gains in the previous session after oil prices reversed and global markets sold off at the end of last week.

In Riyadh, the index slid 0.5 percent in thin trade, dragged down by the petrochemical sector. Saudi Arabia Fertilizer (SAFCO) and Yanbu National Petrochemical were each down more than 1.5 percent.

But some shares were faring better because of positive corporate actions. Saudi Cement rose 2.0 percent after the company recommended a dividend distribution of 3.00 riyals per share for the second half of 2015, versus a proposed dividend of 2.5 riyals a year earlier.

Egypt’s index slid 0.3 percent, erasing some of the previous session's 2.2 percent gain. On Thursday the index triggered a minor bullish right triangle formed by the highs and lows since mid-January and pointing up to around 6,750 points.

Orascom Telecom tumbled as much as 5.0 percent in the first minutes of trade. But the conglomerate’s plan to form a financial power center with the anticipated acquisition of CI Capital from Commercial International Bank is a net positive in the long run, said a note by Sigma Capital.

Palm Hills traded up 1.7 percent after Egypt’s second-largest listed property developer reported a 128 percent jump in fourth-quarter net profit to 203.5 million Egyptian pounds ($26 million). It also proposed its first cash dividend, 0.15 pound per share, and a bonus share issue of one for 20.

“Revenues stood at 957 million Egyptian pounds, beating our forecast of 664 million Egyptian pounds, on higher-than-expected deliveries of villas, apartments and chalets,” said a note by Cairo-based Naeem Brokerage.

In 2016, Palm Hills is expected to have a strong year in terms of both off-plan sales and deliveries, the note added.