Qatar’s Shares Retreat on Speculation Nine-Day Rally Overdone

Qatari shares retreated for the first time in 10 days on speculation recent gains were overdone given earnings and lower dividends at the Persian Gulf nation’s banks.

Commercial Bank of Qatar, the country’s second-biggest lender, dropped the most in almost a week. Qatar National Bank SAQ, the country’s largest bank by assets, fell 1 percent. The QE Index decreased 0.5 percent, the most since Jan. 19, to 8,687.38 at the 1 p.m. close in Doha. The gauge advanced 4.1 percent in the nine days through yesterday. The Bloomberg GCC 200 Index fell 0.1 percent.

“Qatar retreated slightly today after a good set of positive sessions,” said Samer Darwiche, a Dubai-based analyst at Gulfmena Investments. “With a lack of news, investors are profit-taking to protect gains. Investors are also waiting for Industries Qatar QSC earnings after banks announced results.”

Commercial Bank last month posted a fourth-quarter profit that missed analysts’ estimates and said it planned to pay a lower dividend. Investors were also disappointed with dividends at Qatar National Bank and Qatar International Islamic Bank, even after 2011 profit at both companies increased.

Qatar’s Exchange Banking Sector Index has a dividend yield of 4.24. That compares with 2.98 for Saudi Arabia’s listed banks and 2.85 for Abu Dhabi’s ADX Banks Index.

Arabtec Soars

Commercial Bank of Qatar dropped 0.6 percent to 81.8 riyals. Qatar National Bank dropped the most since Jan. 10 to 134.7 riyals.

Industries Qatar, the Middle East’s second-biggest petrochemicals company, was little changed. The company may on March 1 report a 38 percent increase in fourth-quarter profit to 2.07 billion riyals ($568 million), according to the mean estimate of five analysts on Bloomberg.

In Dubai, construction company Arabtec Holding Co. surged for a seventh day, rallying as much as 11 percent to 2.88 dirhams before closing at 2.7 dirhams, the highest since October 2009. Arabtec was the most traded stock on Dubai’s index today, with the volume of shares traded soaring to the highest since March.

“It would be quite improbable for Arabtec to be trading the volumes it is trading, and exhibiting the price behavior it has exhibited for several weeks now without anything of strategic importance being the catalyst,” said Dubai-based Ibrahim Masood, who helps manage about $400 million at Mashreqbank PSC. “There could be some big news on the business side, new business, or fund flows on existing contracts. It could also be something less likely in terms of shareholding change -- that’s a lower probability event.”

Dubai’s DFM General Index and Kuwait’s gauge fell 0.2 percent. Abu Dhabi’s ADX General Index retreated 0.3 percent. Bahrain’s BB All Share Index fell 0.1 percent, while Saudi Arabia’s Tadawul All Share Index rose less than 0.1 percent. Oman’s MSM 30 Index advanced 0.4 percent.

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