Dubai Shares Climb to Three-Month High on Emaar; Qatar Advances

Dubai stocks rallied to the strongest level since June on Emaar Properties PJSC’s plan to sell at least 15 percent of its malls unit in a public offering next month. Shares in Qatar also increased.

The Dubai Financial Market General Index rose 2.7 percent to close at 5,062.96, the highest level since June 5. The gauge has added 4.8 percent this month. Emaar, which accounts for about 21 percent of the index, advanced 8.8 percent to the highest since February 2008. Qatar’s QE Index gained 1.1 percent to 13,596.66.

The developer of the world’s tallest tower plans to sell shares in Emaar Malls Group in September, and list them in October, according to a spokesman who asked not to be identified citing company policy. About 5.3 billion dirhams ($1.4 billion) of proceeds from the stake sale will be used for dividend payments, the developer said in a statement on the bourse’s website. At least 10 percent of the shares will be allocated to Emaar shareholders as of Sept. 10, it said. Emaar in March said it would sell as much as 25 percent of the unit.

“The total float is less than what has previously been announced, but investors are still reacting to it positively,” Ahmed Shehada, the Abu Dhabi-based head of advisory and institutions at NBAD Securities LLC, said by telephone today. “This offering will give the market the much needed momentum it lacked in the last month or so.”

Emaar climbed the most since March 2011 to 11.15 dirhams, taking gains so far this year to 61 percent. That compares with a 50 percent increase in Dubai’s main gauge.

Prized Asset

Emaar is focusing on recurring hotel and mall revenue to cushion itself from shocks in the emirate’s property market. The company’s prized asset is the Dubai Mall, which received 75 million shoppers last year and features hundreds of stores as well as an underwater zoo, skating rink and the world’s most expensive cupcakes.

About 30 percent of the offering will be open to individual investors, and the remaining 70 percent to qualified institutional investors, according to the statement.

Emirates NBD PJSC, Dubai’s largest bank, rose 2.9 percent to 9.68 dirhams, the biggest advance since July 24. Arabtec Holding Co., the United Arab Emirates’ biggest listed builder, added 2.3 percent to 4.82 dirhams, the highest in more than a month.

Buying Opportunity

In Qatar, Masraf Al Rayan, which has the third-biggest weighting on the index, jumped 6.4 percent to 55.30 riyals, the steepest rise since July 1.

The QE Index decreased 3.1 percent on Aug. 28, the most since 2011, before MSCI Inc. adjusted the country’s weight on its Emerging Market Index. It dropped 2.4 percent last week, the first weekly decline in August.

“It’s a good buying opportunity” after the drop last week, Hisham Khairy, the Dubai-based head of institutional trade at Mena Corp. Financial Services LLC, said by telephone today.

Access to Foreigners

Saudi Arabia’s Tadawul All Share Index climbed 0.6 percent to close at 11,112.12, bringing its increase so far in August to 8.8 percent, the biggest monthly jump since February 2012. The world’s top oil producer this month proposed shareholding caps as it prepares to grant foreign investors access to the bourse next year. Al Rajhi Bank, the largest traded Islamic lender globally, advanced 2.4 percent to 77.65 riyals, the strongest level since April 2010. Saudi Electricity Co. jumped 2.5 percent to 17.69 riyals, the highest since October 2006.

Investors from outside the six-nation Gulf Cooperation Council aren’t currently allowed to buy Saudi-listed shares directly, and instead access the market through equity swaps and exchange-traded funds.

Abu Dhabi’s ADX General Index increased by 0.2 percent, Kuwait’s SE Price Index added 0.4 percent and Oman’s MSM 30 climbed 0.1 percent. Bahrain’s All Share Index lost 0.2 percent. Egypt’s benchmark EGX 30 Index rose for a third day, adding 0.1 percent to 9,446.83, the highest in a week. Iraq’s ISX General Index increased 0.3 percent to 100.14, according to data on the bourse website.

Israel Drops

Israel’s benchmark TA-25 index declined 0.3 percent to close at 1,400.33, led by Bank Hapoalim Ltd., which fell 1.4 percent to 19.97 shekels.

Chipmaker EZchip Semiconductor Ltd. jumped 8.7 percent to 97.45 shekels ($27.26), the highest since September, after the company’s U.S. traded shares advanced 12 percent last week to close at $27.94 on Aug. 29.

The yield on Israel’s bonds due March 2024 decreased four basis points, or 0.04 of a percentage point, to 2.4 percent, according to data compiled by Bloomberg.

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