Abu Dhabi Stocks Gain a Fifth Day on Earnings Bets; Dubai Falls

Abu Dhabi’s benchmark index, the world’s fourth-best performing gauge last year, advanced for a fifth day on investor bets shares are cheap relative to earnings prospects. Dubai’s measure declined.

The ADX General Index gained 0.6 percent to 4,383.68, the highest close since August 2008, as Sharjah Cement & Industrial Development Co. and Ras Al Khaimah Cement Co. (RAKCC) rose more than 10 percent. Shares in the measure, which soared 63 percent last year, trade at 11.3 times average estimated earnings compared with 14.6 for Dubai’s gauge and 14.7 for the MSCI World Index. Dubai’s index lost 0.2 percent after more than doubling in 2013.

“The expectation of better earnings is what’s causing the money to come in,” Yaser Abushaban, executive director for asset management at Dubai-based Emirates Investment Bank PJSC, said by phone today.

Share prices in Abu Dhabi have benefited from a recovery in the United Arab Emirates’ financial and property markets and last year beat all but three benchmarks of more than 90 tracked by Bloomberg. Abu Dhabi’s economy is expected to grow at an average 5.7 percent a year through 2016, according to the emirate’s economic development department. That compares with estimated global growth of 2.8 percent this year, according to data compiled by Bloomberg.

Sharjah Cement jumped 11 percent to 1.41 dirhams, its highest close since June 3, in more than 20 times average full-day volume. Ras Al Khaimah Cement surged 15 percent to 1.32 dirhams, the highest close since October 2009.

Extra Shares

Qatar’s QE Index advanced 1.1 percent to the highest since August 2008. The government is offering 4 billion riyals ($1.1 billion) of additional Mesaieed Petrochemical shares to investors in the initial public offering who hold 50 percent of their shares for at least five years and as long as 10 years, Finance Minister Ali Al Emadi said at a press conference yesterday in Doha. He said the company’s IPO value would be 12-billion riyals, almost 5 billion Riyals lower than an earlier forecast of 16.7 billion riyals.

Egypt’s benchmark EGX 30 Index advanced 0.6 percent to 6,852.46, set to extend its winning streak to four days, the longest since November. Commercial International Bank Egypt SAE, the biggest publicly traded lender, led gainers with a 1.1 percent increase. Resorts developer Amer Group jumped 5.3 percent on 3.6 times its three-month average daily volume.

Vote Nears

The North African country’s borrowing costs declined at a debt auction as the scheduled Jan. 14 start of a public vote on a new constitution nears. Increasing violence between the government and opposition Islamists has so far failed to stop the referendum. The average yield on three-month T-bills sold today fell 14 basis points to 10.392 percent while the nine-month yield dropped 15 basis points to 10.964 percent. Both are near the lowest since January 2011.

Oman’s measure gained 0.1 percent. Saudi Arabia’s Tadawul All Share Index (SASEIDX) closed little changed at 8,638 as did Kuwait’s and Bahrain’s gauges.

In Israel, the TA-25 Index (TA-25) added 0.1 percent, while the yield on the government’s debt maturing in March 2023 fell one basis point to 3.69 percent.

To contact the reporters on this story: Sarmad Khan in Dubai at skhan170@bloomberg.net; Ahmed A. Namatalla in Cairo at anamatalla@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

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