October 26, 2017 / 1:23 PM / 24 days ago

MIDEAST STOCKS-Gulf markets flat on steady oil, banks weigh on Abu Dhabi

* Oil prices slip on increased U.S production

* But crude still high on comments from Saudi

* First Abu Dhabi Bank weighs on Abu Dhabi index

By Davide Barbuscia

DUBAI, Oct 26 (Reuters) - Stock markets in the Middle East were largely flat on Thursday on the back of steady oil prices, but exchanges in Dubai and Abu Dhabi shed some value, dragged down by some companies missing investors’ expectations.

Oil prices steadied, supported at near multi-month highs by tighter crude markets, but slightly pressured by an unexpected increase in U.S. production, exports and crude inventories.

Brent crude was changing hands at $58.34 a barrel at 1221 GMT, backed by comments from Saudi Arabia’s energy minister earlier this week which confirmed that the country - the world’s top crude exporter - is determined to end a global supply glut that has impacted oil prices over the past three years.

Saudi Arabia’s Crown Prince Mohammed bin Salman reiterated Saudi Arabia’s commitment to stabilise oil demand and supply in an interview with Reuters.

The Saudi index was flat, marked by the continued sell off of Zain Saudi, which lost 3.8 percent on Thursday. The company announced a 38 percent capital reduction on Wednesday, alongside a 6 billion riyals ($1.60 billion) rights issue.

This led to a huge sell off on Wednesday, with the shares losing nearly 10 percent. According to a research note by Arqaam Capital, however, proceeds from the rights issue, which should be used to partially deleverage the company, will massively improve the company’s profitability next year.

First Abu Dhabi Bank, the largest bank in the United Arab Emirates, lost 1.9 percent after having reported an 18 percent drop in third-quarter profit on Wednesday. The bank, which was created last year by the merger of National Bank of Abu Dhabi and First Gulf Bank, posted a net profit of 2.61 billion dirhams ($710.61 million), below EFG Hermes’ 2.85 billion dirhams forecast.

FAB’s performance dragged down the Abu Dhabi index, which lost 0.7 percent on Thursday. On the same exchange, Etisalat posted a 0.3 percent gain after reporting a 29 percent increase in third-quarter net profit on Wednesday.

The Dubai index slipped 0.4 percent with Emaar Properties and Emaar Malls shedding 0.9 percent and 1.3 percent respectively after Emaar Properties said an initial public offering in its development unit would be a similar size to the offering of Emaar Malls when it was listed on Dubai Financial Market in 2014.

Emaar Properties had dropped two percent on Sunday after it said it expected to sell a 20 percent stake in Emaar Development, less than had been anticipated. ($1 = 3.7501 riyals)

HIGHLIGHTS

SAUDI ARABIA

* The index was flat at 6,910 points.

DUBAI

* The index went down 0.4 percent to 3,651 points.

ABU DHABI

* The index dropped 0.7 percent to 4,467 points.

QATAR

* The index . was flat at 8,128 points.

EGYPT

* The index gained 0.4 percent to 13,955 points.

KUWAIT

* The index was flat at 6,623 points.

BAHRAIN

* The index was flat at 1,277 points.

OMAN

* The index slipped 0.8 percent to 4,958 points.

$1 = 3.6729 UAE dirham Editing by Robin Pomeroy

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