There’s more to it than you thinkJune 30, 2015 9:42
DP World slides after listing delay
‘People sitting on sidelines and waiting for Q2 numbers’
June 29, 2010 3:22 by Samuel Potter
Dubai’s DP World tumbled after postponing plans for a dual listing in London on Monday and most Middle East stocks fell slightly as continued uncertainty on equity markets worldwide deterred trade.
DP World fell 4.8 percent. It will delay dual listing on the London Stock Exchange until after its 2010 financial results are published next March, pending a link between the Nasdaq Dubai and LSE trading platforms.
“The (dual listing) did not make much sense to most of the investment community here,” said Mohammed Yasin, Shuaa Securities chief executive, adding the company’s investor base was in Gulf Arab region, not London.
Uncertainty over a world economic recovery and euro zone sovereign debt continues to weigh on sentiment in the Middle East, with trading volumes falling across the region.
“People are sitting on the sidelines and waiting for the Q2 numbers, with the Saudi earnings season starting on Saturday,” said a Riyadh-based analyst who asked not to be identified.
“Expectations are quite high for Q2, particularly for the retail and petrochemicals sector, but there’s an over-riding feeling that while Q2 will be good, Q3 is not looking so hot and so people are hesitant and there’s an overall jitteriness.”
The Dubai index fell 1.2 percent to 1,515 points. The Abu Dhabi measure edged up 0.1 percent to 2,553 points.
Youssef Kassantini, a Riyadh-based financial analyst, offered a more optimistic longer-term outlook.
“International markets look like they will continue to correct and that will affect our (Saudi) market as well, but investors should see any declines locally as an opportunity to buy, not to sell,” said Kassantini. “Our market has strong fundamentals and Q2 results should be good, especially in the petrochemicals sector.”
The Tadawul All-Share index (TASI) declined for a fourth session in five to close at 6,302.58.
Banque Saudi Fransi fell 1.6 percent, Arab National Bank lost 1 percent and Saudi Electricity Co. dipped 0.7 percent. The sector activity for the day was mostly negative with 12 out of 15 sectors closing with losses ranging from 0.01 percent by the Telecommunication & Information Technology sector to 1.29 percent by the Transport sector. On the other hand gaining sectors ranged from 0.18 percent by the Multi-Investment sector to 0.44 by the Cement sector. The overall market breadth for the day was also negative with 45 advancers against 72 decliners giving it an AD ratio of 0.625, the Financial Transaction House (FTH) said in its daily market commentary.
The liquidity for the day remained at the same level as Sunday and reached SR2.8 billion.
Emirates Telecommunications Corp. (Etisalat) rose 1 percent after saying it had not made a bid to a buy a stake in Kuwait operator
Zain. The latter ended unchanged.
“Zain is like Scarlett in Gone with the Wind — it’s drama after drama, so we’re used to these rumors,” said a Kuwait trader who asked not to be identified.
“Kuwait continues to suffer low volumes. The small caps took a hit today and everyone is talking about the market revisiting the March 2009 lows. You can’t make a quick buck when everyone is on the same side.”
The Kuwaiti benchmark fell 0.2 percent to 6,558 points.
Property-related stocks dominated Dubai trade. Emaar Properties fell 2.1 percent, Deyaar lost 4.4 percent and Arabtec dropped 2.2 percent.
Dubai house prices are not seen recovering before 2011 at the earliest while oversupply in commercial property will boost vacancy rates to more than 50 percent next year Jones Lang LaSalle said on Sunday.
“We are seeing no institutional flow this week, it’s all a retail game,” said Saad Al-Chalabi of Al-Ramz Securities. “The market should test the previous lows and possibly continue lower.”
The Omani index dropped 0.5 percent to 6,126 points. The Qatari index fell 0.3 percent to 7,041 points.