April 1, 2018 / 8:15 AM / 24 days ago

MIDEAST STOCKS-Qatar surges on plan to raise ownership caps, Jabal Omar sinks in Saudi

DUBAI, April 1 (Reuters) - Qatar’s stock index surged in early trade on Sunday because of plans to raise ceilings for foreign ownership in several more companies, while Saudi Arabia moved sideways in the wake of FTSE Russell’s decision to upgrade it to emerging market status.

The Qatari index added 0.9 percent as Qatar Fuel jumped 7.7 percent, Gulf International Services Co rose 5.7 percent, Mesaieed Petrochemical soared 10.6 percent and Qatar Electricity and Water Co gained 1.1 percent. They were among the market’s most heavily traded stocks.

Parent Qatar Petroleum said the companies would take necessary steps in coming weeks to approve an increase in their foreign ownership limits to 49 percent. Actual foreign ownership levels aren’t close to the current ceilings, but higher ceilings will likely boost the stocks’ weightings in emerging market indexes.

The Saudi stock index, which had surged before FTSE’s announcement on Wednesday night, moved sideways in the first 45 minutes. The decision will bringing billions of dollars of new foreign money to the market but actual inclusion in the index will only happen from March 2019, and in the meantime, many Saudi stocks are now fully valued.

Real estate developer Jabal Omar dropped 4.3 percent after reporting it swung to an annual net loss of 601 million riyals ($160.2 million); it cited weak revenue from sales of residential units due to delays in obtaining marketing permits, and higher administrative and general expenses.

Investment firm Kingdom Holding, chaired by Prince Alwaleed bin Talal, rose 1.9 percent and touched its highest level in over a month after proposing a cash dividend of 0.50 riyal per share for 2017, the same as in previous years.

The dividend appeared to be another sign that Kingdom’s operations have not been seriously disrupted by the detention of chairman Prince Alwaleed bin Talal in the country’s corruption probe, though the firm may now be more inclined to invest in government projects as part of an understanding with authorities. Prince Alwaleed was freed in January and has insisted he is innocent of any wrongdoing, but Saudi officials said he signed an undisclosed settlement.

Dubai was up 0.5 percent with Deyaar Development up 2.9 percent, continuing to rebound after hitting a 10-month low last week. Abu Dhabi was flat as the biggest bank, First Abu Dhabi, lost 1.3 percent. (Reporting by Davide Barbuscia; Editing by Andrew Torchia)

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