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Dubai Shares Fall on Concern Company Earnings May Disappoint

Dubai Shares Fall on Company Earnings Concerns
Emaar Properties, builder of the Burj Khalifa, led the decline in Dubai shares. Photographer: Charles Crowell/Bloomberg

Oct. 17 (Bloomberg) -- Dubai shares declined for a second day on concern companies in the emirate will report lower-than-expected third-quarter earnings and after oil tumbled to the lowest level in two weeks.

Emaar Properties PJSC, builder of the world’s tallest skyscraper, led the decline and Arabtec Holding Co. slipped 1.8 percent. The DFM General Index retreated 0.1 percent to 1,744.46 as 12 stocks fell, seven rose and 13 were unchanged. The benchmark index closed at the lowest since Oct. 12. The index has gained 19 percent so far in the second half of the year. Most other Middle East markets were little changed.

“Investors are waiting at the sidelines as they anticipate third-quarter results,” said Haissam Arabi, chief executive officer of Gulfmena Alternative Investments in Dubai. “There’s a little profit-taking. But we expect the recent rally to continue.”

Southern Province Cement Co., the largest cement producer in Saudi Arabia, yesterday posted a 16 percent decline in third-quarter profit. The shares retreated 1.9 percent to 64 riyals. Al-Khalij Holding, the Qatari holding company, said on Oct. 14 its nine-month profit dropped 46 percent to 33.5 million riyals ($9.2 million). The shares fell 2.7 percent to 14.4 riyals in Doha trading.

Crude Oil Drops

Crude for November delivery fell 1.7 percent to $81.25 a barrel on the New York Mercantile Exchange on Oct. 15 after a strengthening U.S. dollar curbed the appeal of commodities as an alternative investment. The six nations of the Gulf Cooperation Council supply about a fifth of the world’s oil.

Emaar fell as much as 1.5 percent to 3.88 dirhams and closed at 3.92 dirhams. Arabtec may report a 42 percent decline in third-quarter profit to 97 million dirhams ($26.4 million), according to the mean estimate of five analysts in a Bloomberg News survey. The shares dropped to 2.24 dirhams, the lowest level since Oct. 7.

Emirates NBD PJSC, the U.A.E.’s biggest bank by assets, may report next week third-quarter net income fell 17 percent to 875 million dirhams, according to the mean estimate of two analysts in a Bloomberg survey.

Oman’s MSM30 Index and Qatar’s measure lost 0.1 percent. Abu Dhabi’s measure increased 0.2 percent and Bahrain’s gauge rose 0.1 percent. Saudi Arabia’s Tadawul All Share Index was little changed, while the Kuwait SE Price Index increased 0.3 percent. In North Africa, Egypt’s EGX 30 Index was little changed.

Israel’s TA-25 Index surged to the highest intraday on record, rising as much as 0.4 percent to 1,262.56. The gauge closed at a record on Oct. 14. The country’s benchmark 5 percent Mimshal Shiklit government bond due January 2020 dropped, pushing the yield 6 basis points higher to 4.40 percent.

-- With assistance from David Wainer in Tel Aviv. Editors: Digby Lidstone, Claudia Maedler.

To contact the reporter on this story: Zahra Hankir in Dubai at zhankir@bloomberg.net.

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

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