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Pressure mounts on UAE, Saudi stocks as investors await first-quarter 2021 results

Bears ruled over Saudi Arabian stocks for a fourth day with lenders and petrochemical stocks part of the pullback, while other GCC markets underwent intense selling pressure from their banks.

Saudi Arabia's benchmark index dropped 0.6 per cent to 9,845 points in what was its fourth consecutive day of trading down. Al Rajhi Bank and Saudi National Bank retreated 1 and 1.3 per cent, respectively, while Saudi Aramco slipped 0.6 per cent. Arabian Shield Cooperative Insurance dipped 2.1 per cent after its board decided against dividends for 2020.

Al Ahli Takaful inched lower by 2 per cent, extending its losses after initiating merger talks with Arabian Shield.

Abu Dhabi Securities Exchange dipped 1.2 per cent to 6,019 points, breaking a stretch of gains that had sent the index soaring to its best since 2005. Investors on Tuesday preferred to encash their positions ahead of Q1-2021 earnings that may not necessarily come out to their liking. Banking sector had the biggest drag with heavyweight First Abu Dhabi Bank shedding 2.2 per cent and Abu Dhabi Islamic Bank sinking 5 per cent on its ex-dividend date.

Steep drop

Commercial Bank International dived 10 per cent, the most permitted in a single session. The drop represents its worst performance in a year and throws it deeper into the red with a 16 per cent negative value growth for the year. The decline follows its chief financial officer Danay Lea resigning from the role. The move comes after the lender's 2020 profits dropped 66 per cent to Dh38 million in a year that it said was unprecedented in terms of the challenges.

Dubai Financial Market traded 0.8 per cent lower at 2,566 points with most sectors slipping nd banking stocks doing more damage. Emirates NBD, and Dubai Islamic Bank slipped 1.7 per cent. Property shares which traded upward earlier in the day also pulled back by the end of the session leading to the index further drifting into negative.

Banks wreak havoc

Financials behaved no differently in Qatar where the market ticked down 0.2 per cent at 10,480 points, with Qatar Islamic Bank leading the losses as its first-quarter results was below expectations. Kuwait also had a similar story, coming under selling pressure from banks. Kuwait Finance, Boubyan Bank and Burgan Bank all headed lower as investors awaited first quarter results.

Oman's 30-company index dipped 0.2 per cent lower at 3,718 points weighed down by Bank Muscat, Sohar International Bank and National Bank of Oman. Sembcorp Salalah saw its price clipped by 1.2 per cent after its first-quarter profits went into a 23 per cent swoon. AAl Omaniya Financial Services soared 5.5 per cent as its bottomline jumped by a quarter for the same period.

Defies trend

But Bahrain bucked the trend by closing the session up 0.4 per cent at 1,468 points as Ahli United Bank and Aluminium Bahrain displayed some strength to overpower losses elsewhere. Trafco Group dropped 9.4 per cent, and GFH Financial Group shed 0.6 per cent after going ex-dividend in the last session.