x

Abu Dhabi, UAEWednesday 19 September 2018

Qatar stocks plunge as squeeze on banks increases

Doha stocks suffered their worst day since the start of the current political crisis

A traditional dhow floats in the Corniche Bay of Doha, Qatar, in front of the city's financial district in the background. Shares in the country's banks slumped on Sunday as the country's economic isolation continues. Saurabh Das / AP Photo
A traditional dhow floats in the Corniche Bay of Doha, Qatar, in front of the city's financial district in the background. Shares in the country's banks slumped on Sunday as the country's economic isolation continues. Saurabh Das / AP Photo

Shares in Qatar suffered their worst day yesterday since the outbreak of the current economic and diplomatic crisis on June 5, as the country’s stock market resumed trading after a week-long Eid holiday.

Saudi stocks by contrast enjoyed a positive day, with shares in Saudi Mining Company (Maaden) soaring to an all-time high.

The Qatar exchange ended the day down 2.3 per cent at 8,822.15, ahead of a deadline imposed by the UAE, Saudi Arabia and other states for the country to accept a series of political demands, which the Qatari government is unlikely to do.

Banking stocks were the main casualties of the day, led by Qatar Islamic Bank. The institution’s stock sank 5.8 per cent to an 18-month low of 18.10 Qatari riyals.

Masraf Al Rayan and QNB followed suit, finishing down 2.3 per cent and 1.2 per cent respectively.

Several British banks said late last week that they had stopped dealing in Qatari riyals, with a resolution to the country’s economic and political crisis seemingly far off.

Meanwhile, shares in Saudi Arabia rose on the back of positive sentiment around the country’s inclusion last month on a watchlist for membership of index provider MSCI’s widely tracked Emerging Markets Index.

The Tadawul ended the day up 0.8 per cent, thanks to gains by NCB and Maaden.

The latter’s shares surged 8.4 per cent to an all-time high of 53.05 Saudi riyals, following the signing of an agreement with global engineering firm Fluor for the development of further projects within the country. This agreement in turn comes after MoUs signed with Mosaic and Alcoa at last month’s Saudi-US CEO Forum.

“Fluor's agreement with Maaden is positive on sentiment as it provides some visibility with respect to providing management contracting services for Maaden's future projects,” said M Nayal Khan, the head of institutional sales trading at Saudi Fransi Capital.

“While neither [the Mosaic or the Alcoa] is expected to come online before 2024 and preliminary details are thin, both projects have a reasonably strong likelihood of advancing given the strong push by the state to develop mining as an engine for jobs and feeder for downstream industries including automotive, appliances and munitions.”

Shares in the UAE were mixed; Dubai stocks closed 0.3 per cent lower at 3,383.31, with trading volumes for the day less than a third of the daily average for the past six months.

Falls by DIB and Emaar Malls counterbalanced rises by Damac Properties and Aramex.

The Abu Dhabi Securities Exchange General Index spent much of the day in negative territory before rising at close to end up 0.4 per cent at 4,443.66, thanks to gains by Etisalat and Eshraq Properties.

Eshraq stocks, which accounted for about two-thirds of daily trading volumes, rose 10.5 per cent to 95 fils, regaining ground after experiencing a sharp fall at the end of last week.

RELATED ARTICLES
Recommended