DUBAI: Orascom Telecom (OT) surged on market talk it will sell its Algerian unit Djezzy, lifting Egypt s index to a 23-week high on Thursday.
Dubai fell to a two-week low, Abu Dhabi extended losses and Bahrain and Kuwait also declined following heavy profit-taking in dual-listed Ahli United Bank (AUB).
OT, the Arab world s largest mobile operator by subscribers, climbed 9.3 percent. On Monday, it said it had appealed to Algeria s administrative court to cancel a claim it owes $597 million in back taxes. OT s rise is a continuation of rumors that Djezzy will be sold or OT as a whole will be sold, said Teymour El-Derini of Naeem Brokerage.
Egypt s index rose 1.5 percent, its highest close since Oct. 26.
AUB fell 4.2 percent in Kuwait and 9 percent in Bahrain, dragging the latter s index down 2 percent, its biggest decline since July 13. Both AUB listings hit 17-month highs this week ahead of a slated stake sale.
We still don t know whether minority shareholders will benefit from a stake sale or not, said Shakeel Sarwar, Sico investment bank head of asset management. There s no clarity, so there is now some profit-taking in the stock.
Dubai s index fell 1.9 percent to its lowest close since March 24, the last day s trading before Dubai World unveiled a debt restructuring offer. The benchmark has fallen 6.1 percent since March 28, giving back a Dubai World-inspired rally.
There s a lot of talk among investors that most companies will report very mediocre results, said Vyas Jayabhanu, head of investments, Al Dhafra Financial Broker. People are very negative, especially since Emaar rolled over some debt – they re asking whether it means trouble for the company ahead.
On Sunday, Emaar said it would roll over $1.23 billion debt maturing in 2010 into long-term project financing deals. The stock fell 2.1 percent on Thursday, taking its losses to 5.9 percent in four days.
On Wednesday, Standard & Poor s cut its long-term issuer credit rating on the developer.
The downgrade reflects our view of the continuing challenging real estate market conditions in Dubai and the reliance of Emaar s cash flows on the delivery of outstanding projects, said S&P s credit analyst Paul Lund.
Emaar is expected to outperform rival UAE developers in first-quarter earnings, analysts said.
Seven Dubai stocks fell by more than 2 percent, including Dubai Islamic Bank, which dropped 7.8 percent after going ex-dividend.
The market broke a technical support, sparking a further wave of profit taking, but at the end of the session some buyers did step in, said Chamel Fahmy, Beltone Financial regional senior sales trader.
The market was overbought and people are looking at technical analysis because there is no fundamental news – it will be technically-driven until we get some Q1 figures.
Oman s index rose 0.1 percent, its first gain in three days, as institutions accumulated banking, industrial and service stocks to be within a few fils of Monday s 17-month high.
The market is holding up, but the volumes are low today, with investors waiting for more clarity on first-quarter results from the banking and industrial sectors, said Adel Nasr, United Securities brokerage manager.
