RIYADH, May 15 (Reuters) - Most Gulf stock markets were firm in early trade on Tuesday, with Saudi Arabian petrochemicals aided by strong oil prices and Qatar buoyed by MSCI’s decision to increase the weightings of several blue chips.
The Saudi index rose 0.2 percent to 8,090 points in the first 55 minutes, with top petrochemical producer Saudi Basic Industries gaining 0.9 percent.
“The index has recovered from its recent correction and remains solid above 8,000 points, backed by upbeat sentiment as investors await MSCI’s announcement over next two to three weeks,” said Muhammad Faisal Potrik, head of research at Riyad Capital. MSCI will announce in June whether it will upgrade Saudi Arabia to emerging market status.
“We expect banks and petrochemicals to lead market movement over the next few weeks, although activity will usually be lower during Ramadan,” he added. The holy month of Ramadan will start this week.
Saudi British Bank (SABB) and Alawwal Bank asked the bourse to suspend trading in their shares pending an announcement. They have been conducting merger talks.
The Dubai index was up 0.7 percent as heavyweight Emaar Properties rose 1.8 percent, rebounding for a second day from a two-year low.
Its affiliate Emaar Development gained 1.8 percent after MSCI decided overnight to add the stock to its United Arab Emirates index at the end of this month; the decision had been widely expected.
Builder Drake & Scull jumped 6.1 percent after reporting it swung to a small first-quarter net profit from a huge year-earlier loss.
But DAMAC Properties fell 5.6 percent after posting a 45 percent drop in first-quarter profit, missing analysts’ estimates.
In Abu Dhabi, the index rose 0.7 percent, backed mainly by heavyweight First Gulf Bank, which rose 1.3 percent. Aldar Properties added 0.5 percent after the largest developer in Abu Dhabi reported a 5 percent rise in quarterly profit, beating estimates.
Qatar’s index rose 0.3 percent on a 3.8 percent gain by Qatar National Bank and a 2.2 percent increase by Qatar Islamic Bank. MSCI said it would raise their weightings after the companies increased their foreign ownership ceilings.
Qatar Gas Transport tumbled 5.9 percent after MSCI downgraded the stock to its small cap index; Arqaam Capital estimated there was only a 10 percent chance of that happening. (Reporting by Marwa Rashad; Editing by Andrew Torchia)