Mideast Stocks Shrug Off Turkey Coup as Almarai Rises on Profitby , , and
MSCI World Index snaps longest winning streak since October
Summer holidays reduce level of trading volumes across Gulf
Most Gulf stock indexes rose, even after an attempted coup in Turkey that began on Friday rattled global markets.
Saudi Arabia’s Almarai Co., the region’s largest publicly-traded packaged-food manufacturer, climbed as much as 5.5 percent before closing 2.3 percent higher as it posted a 19 percent increase in second-quarter profit. It was the third-biggest contributor to the Tadawul All Share Index’s 0.3 percent gain. The Bloomberg GCC 200 Index, which tracks some of the leading companies in the six nations that comprise the Gulf Cooperation Council, added 0.2 percent.
Stocks in the Middle East were the first to trade after an attempted military coup that left more than 200 people dead in Turkey collapsed just hours after it started. The MSCI ACWI Index of emerging and developed markets ended a six-day winning streak, the longest stretch of gains since October, as the clashes erupted. With most of the Middle East region’s biggest investors still on vacation, the volume of shares traded on gauges across most of the GCC markets fell below their six-month averages.
“At the end of the day, there was no change in government,” in Turkey, said Sanyalak Manibhandu, the head of research at NBAD Securities LLC, a unit of Abu Dhabi’s biggest bank. “There has been no disruption to crude supply, trade and transport. Also, a lot of big investors are on holiday, but they’re on holiday until something big brings them back.”
Turkey’s lira plunged the most in eight years after factions of the country’s military tried to seize power from President Recep Tayyip Erdogan. The central bank on Sunday moved to reassure investors, announcing it would make available unlimited liquidity to banks. Sekerbank TAS delayed investor meetings for the sale of as much as $300 million in bonds.
Second-quarter profit at Almarai rose to 628.8 million riyals ($168 million) as sales climbed 10 percent, according to a company statement to the Saudi bourse on Sunday. Traders exchanged 1.1 million of the company’s shares, more than three times the six-month average.
Manibhandu, who has an accumulate recommendation on the company, said it “gives investors a way to diversify from banks and petrochemicals.”
Dubai’s DFM General Index and Abu Dhabi’s ADX General Index gained 0.5 percent each. Oman’s MSM 30 rose 0.2 percent. In Bahrain, the BB All Share Index fell 0.7 percent. Qatar’s gauge retreated 0.1 percent, while Kuwaiti stocks were little changed.
Egypt’s benchmark EGX 30 Index advanced 0.2 percent, coming off its best weekly performance in four months on speculation the country is preparing to devalue its currency for the second time this year to alleviate a dollar shortage. Bets on a cheaper Egyptian pound also moved to the government debt market last week, forcing borrowing costs to the highest levels in almost four years.
Israel’s TA-25 index of stocks fell 0.1 percent at the close in Tel Aviv. Teva Pharmaceutical Industries Ltd. and Avner Oil Exploration LP led decliners with 1.1 percent and 1 percent losses, respectively.
Shares in Discount Investment Corp. soared 23 percent, the most since August 2012. The company said it entered into an agreement to sell its remaining 40 percent stake in Adama Agricultural Solutions Ltd., the world’s largest maker of generic agro-chemicals, to China National Chemical Corp.
The yield on the Israel’s 6.25 percent benchmark bonds due October 2026 increased two basis points to 1.72 percent.