Dubai's Stocks Rally Most in 10 Months as Egypt Mubarak Says to Step Down
Persian Gulf shares rose, sending Dubai’s gauge up the most in almost ten months, on optimism Egyptian President Hosni Mubarak’s pledge to step down will help quell protests that entered a ninth day.
Emaar Properties PJSC, the builder with investments in the North African country, gained the most since June. Dubai Islamic Bank PJSC advanced 3.7 percent after Fitch Ratings assigned the lender a long-term foreign currency issuer rating of A. The DFM General Index surged 3.3 percent, the most since April 11, to 1,594.87 at the 2 p.m. close in Dubai. The measure extended gains after Yemen’s president said he won’t seek another term. The Bloomberg GCC 200 Index climbed 1.5 percent, the most since Dec. 5, at 1:20 p.m. in Riyadh.
Mubarak’s speech offered a “clearer picture in terms of the political reading regionally; the markets had overreacted before,” said Haissam Arabi, chief executive officer of Gulfmena Alternative Investments in Dubai. “We expect minimal impact on the micro level. It’s a matter of days before the dust settles.”
Mubarak said he won’t run for another term and would make way for a new leader in presidential elections in September, a concession rejected by opposition leaders and protesters who refuse to wait months for the end to his regime. He’ll stay on to ensure “stability” and push through political and economic changes before his departure, he said.
The president last week appointed Omar Suleiman, head of Egypt’s intelligence services, as his vice president. Egypt’s bourse, which has been closed all week, will remain closed tomorrow. Egypt’s benchmark Index tumbled 16 percent last week.
The unprecedented protests, which followed a revolt in Tunisia that ousted President Zine El Abidine Ben Ali on Jan. 14, have left more than 100 people dead in Egypt and roiled international stock, bond and oil markets.
Unrest has spread to Yemen, where President Ali Abdullah Saleh told parliament today that he won’t seek to extend his term when it expires in 2013 and called for the formation of a national unity government. Jordan’s King Abdullah sacked his prime minister yesterday.
“It appears the leaders are trying to prevent or avoid similar scenarios happening in their own countries,” Gulfmena’s Arabi said. “These are steps in the right direction. Change is good.”
Jordan’s ASE General Index increased 1.1 percent today. Lebanon’s BLOM Stock Index rose 0.6 percent, Morocco’s Madex gained 0.8 percent and Tunisia’s Tunindex rose.
Abu Dhabi Gains
Emaar increased 5.8 percent to 3.28 dirhams. The company’s Egyptian unit, Emaar Misr for Development S.A.E., has investments of about 29 billion dirhams ($8 billion) in Egypt, according to its website.
Dubai Islamic, the United Arab Emirates’ biggest bank complying with Shariah banking rules, rose the most since Oct. 28 to 2.25 dirhams. Fitch assigned the bank with a stable outlook citing its “strong franchise, earnings power and satisfactory liquidity position” and the likelihood of support from the U.A.E. government if needed.
Abu Dhabi’s ADX General Index jumped 1 percent, while Bahrain’s BB All Share Index retreated 0.4 percent. Qatar’s QE Index was little changed, Kuwait’s SE Price Index increased 0.2 percent and Oman’s MSM30 rose 0.6 percent.
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