Header Ads Widget

Responsive Advertisement

Saudi banking, petrochemical stocks take a dive as bearish trends take hold

Saudi market underperformed after banking and petrochemical stocks came under selling pressure, snapping five days of gains, while in Dubai, ex-dividend was a factor behind the slipping into the red.

The Saudi benchmark index tripped up by 1.1 per cent to 10,419 points. Al Rajhi Bank, Saudi National Bank and Riyad Bank headed lower with Saudi Aramco joining in the downside by shedding 1.1 per cent. The petrochemicals giant Saudi Basic Industries (Sabic) retreated 3 per cent despite reporting SR4.86 billion in first-quarter profits, a rebound from year-ago losses amounting to SR1.05 billion.

Retailer and food company Savola Group traded 2.6 per cent lower after the first-quarter profits dipped 11 per cent to SR154 million owing to lower sales and margins in the retail sector. Profit contributions from associate companies also took a hit while operating costs and Zakat and tax expenses moved higher.


Dubai Financial Market inched 0.6 per cent lower to 2,605 points, pulled lower by real estate, industrial and banking stocks. Many were trading ex-dividend, which also weighed down the index with Takaful House sinking 6.4 per cent as it underwent intense selling pressure after investors secured last-declared dividends.

The stock is still trading higher by more than 10 per cent for the year as it attracted buyers on the back of full-year dividends amounting to 10 per cent of the capital. Aramex and Shuaa Capital dropped as they were also trading without dividend entitlements.


But the shipping company Gulf Navigation climbed around 3 per cent after announcing Dh200 million worth of debt restructuring under new terms aimed at reducing its financing costs by 25 per cent. The firm is further seeking improved terms from a majority of lenders to help it adapt to market conditions. It also predicted a shift to profitability this year itself.

Abu Dhabi Securities Exchange saw a 0.6 per cent slip up at 6,047 points. Banking stocks acted as the biggest drag with First Abu Dhabi Bank, Abu Dhabi Islamic Bank and Abu Dhabi Commercial Bank heading lower.

Etisalat surged 1 per cent during the session after reporting an 8 per cent jump in first-quarter profits before heading back to settle 0.6 per cent down for the day. The stock was already trading more than 25 per cent higher and investors appeared to seize the opportunity for profit-booking.