August 5, 2019 / 1:42 PM / 17 days ago

MIDEAST STOCKS-Trade war rattles Gulf stocks, Qatar slips to worst day in two years

    * Banks are down across Gulf
    * Banque Saudi Fransi falls on lower Q2 profit
    * Walaa Cooperative slumps on Q2 loss
    * Gulf International Services sinks on H1 profit drop
    * Emaar Properties slips on weak Q2 earnings

    By Shakeel Ahmad and Maqsood alam
    Aug 5 (Reuters) - Gulf stock markets tumbled on Monday and Qatar suffered
its biggest single-day loss as a new war of trade between the United States and
China drove investors towards safer assets.
    Investors are also cashing in their positions ahead of a religious holiday
starting from Sunday.
    U.S. President Donald Trump last week threatened to impose a 10% tariff on
remaining $300 billion worth of Chinese imports and China said it would
retaliate, adding to the woes of a global economy already showing signs of
slowing down. 
    The move, which could limit crude demand, caused oil prices to fall, handing
yet another reason for oil-reliant Middle East markets to worry.
    "China’s retaliation by way of halting some US imports & letting the
currency weaken against the dollar is impacting markets worldwide. MENA equities
tend to correlate more with Global markets during extreme movements," said
Vrajesh Bhandari, senior portfolio manager at Al Mal Capital. "For the Middle
East, tumbling crude oil prices is yet another negative." 
    "Not surprising that traders are taking money off table before going into an
extended break for the Eid holidays," Bhandari added. 
    The Saudi Arabian index which was also hit by disappointment over
some corporate earnings, fell 1.1% with all its banking shares falling. 
    Banque Saudi Fransi shed 3.6% after posting a 4.4% decline in
second-quarter profit, citing higher provision for zakat, an Islamic tax in
Saudi Arabia.
    The insurer Walaa Cooperative Insurance slid 6.1% after swinging
to a pre-zakat loss in the second quarter. Travel company, Seera Group Holding
, which posted a 35.9% slump in profit for the same period, fell 2.7%. 
    Qatar's index plunged 4.2% to its biggest single-day loss since June
5, 2017, wiping out gains for the year in its fifth straight session of losses. 
    Blue-chip stocks hurt the index the most with Qatar National Bank
slumping 6%, while petrochemical maker Industries Qatar raced 5.8%
lower.
    Gulf International Services sank 9.7% after the drilling rig
provider posted a nearly 15% decline in first-half profit
    In Dubai, the index fell 2% with property and financial stocks
weighing heavily on the index. Dubai Islamic Bank slipped 2.1% and
Emaar Properties, dropped 3.3%.
    Emaar Properties reported a 7.4% decrease in second-quarter profit to 1.37
billion dirhams ($373 million), missing an EFG Hermes forecast of AED 1.55
billion dirhams
    Dubai prime residential property prices fell 1.9% in the first half of the
year due to the market being oversupplied, Reuters reported on Monday citing
real estate company Savills.
    The Middle East financial hub's real estate market has steadily contracted
since mid-2014 as foreign investor interest cooled.
    In Abu Dhabi, the index was down 1.9%. Market heavyweight lender
First Abu Dhabi Bank dropped 2.2%, while Emirates Telecommunications
Group lost 2.6%.
Egypt's blue-chip index edged 0.1% lower with Qalaa Holdings
losing 4.3%.

 SAUDI ARABIA  The index         was down 1.1% to 8,465 points
 ABU DHABI     The index        lost 1.9% to 5,083 points
 DUBAI         The index          fell 2% to 2,800 points
 QATAR         The index        plunged 4.2% to 9,925 points
 EGYPT         The index          slipped 0.1% to 13,599 points
 BAHRAIN       The index        fell 0.3% 1,545 points
 OMAN          The index        was up 0.2% at 3,789 points
 KUWAIT        The index        was flat at 6,727 points
 


 (Reporting by Shakeel Ahmad Maqsood Alam in Bengaluru)
  
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