February 27, 2018 / 1:27 PM / a year ago

MIDEAST STOCKS-Gulf mostly weak but Vodafone Qatar soars on earnings, licence news

* Vodafone Qatar by far the most heavily traded stock

* But Qatar Electricity and Water plunges as it goes ex-dividend

* Saudi banking sector weak for third straight day

* Tasnee surges on strong annual earnings

* Egyptian Iron & Steel climbs on forecast of smaller loss

By Andrew Torchia

DUBAI, Feb 27 (Reuters) - Major Gulf stock markets were mostly weak on Tuesday but Vodafone Qatar jumped by its 10 percent daily limit in response to a stream of positive news from the company.

By far the most heavily traded stock in its market, Vodafone Qatar said its nine-month net loss narrowed 32 percent and that its telecommunications licence had been extended by 40 years, which would cut annual amortisation costs sharply.

The company also said it planned to reduce its share capital by roughly half, while Vodafone will sell its stake in the firm to Qatar Foundation, whose direct and indirect stake in Vodafone Qatar will rise to 50 percent from 27.05 percent.

The Vodafone brand will remain in Qatar as part of a partnership agreement that will run for an initial term of five years.

The Qatari stock index dropped 0.7 percent, however, as Qatar Navigation fell 1.6 percent after reporting a 34 percent slide in annual net profit. Qatar Electricity and Water tumbled 5.0 percent as it went ex-dividend.

Real estate firm Ezdan fell 2.0 percent as credit rating agency Standard & Poor’s cut its rating of the company to BB-minus with a stable outlook from BB with a negative outlook.

Saudi Arabia’s index edged down 0.1 percent as 10 of 12 banking stocks declined. It was the third straight day that the sector fell, partly because of concern about authorities’ decision to levy more Islamic tax on banks retroactively.

But National Industrialisation Co (Tasnee) jumped 9.9 percent in its biggest volume since May 2016, after reporting that annual net profit soared to 716.2 million riyals ($195.1 million) from 101.4 million riyals.

It also said one of its units had signed a memorandum of understanding to explore the potential of establishing an aircraft precision machining facility in Saudi Arabia - a strategic project that is expected to receive government backing.

Dubai’s index fell 0.6 percent as GFH Financial retreated 2.7 percent and Shuaa Capital sank 3.6 percent.

The stocks had risen sharply on Monday after the chief executive of Abu Dhabi Financial Group (ADFG), Jassim Alseddiqi, was elected chairman of GFH, raising hopes for closer cooperation between GFH and ADFG.

GFH held inconclusive merger talks with Shuaa last year but Shuaa is an affiliate of ADFG, so Alseddiqi’s election also fuelled speculation that the talks could be revived.

However, Alseddiqi told Al Arabiya television on Monday that after last year’s talks failed to produce a result, GFH was currently looking at other acquisitions.

In Egypt, the index rose 0.5 percent. Egyptian Iron & Steel climbed 3.3 percent after predicting a net loss of 116.1 million Egyptian pounds ($6.6 million) for its 2018-2019 fiscal year; in the first half of the current year, it posted a net loss of 231.3 million pounds.


* Index edged down 0.1 percent to 7,465 points.


* Index fell 0.6 percent to 3,286 points.


* Index edged up 0.1 percent to 4,599 points.


* The index dropped 0.7 percent to 8,930 points.


* Index rose 0.5 percent to 15,523 points.


* Index gained 0.2 percent to 6,770 points.


* Index fell 0.4 percent to 1,366 points.


* Index added 0.2 percent to 4,993 points. (Editing by Jon Boyle)

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