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MENAFN - Arab News - 20/05/2009

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(MENAFN - Arab News) Qatar led most Gulf Arab bourses higher yesterday as rising oil prices and strength in global stocks continued to boost investor sentiment.

"Qatar is probably one of the cheapest markets in the region and has the strongest fundamentals. I think it will continue to lead the region for the time being," said Shahid Hameed, head of asset management at Global Investment House in Kuwait.

Oil rose above 60 a barrel earlier yesterday, extending gains from a six-month high settlement a day earlier.

Saudi Arabia was the day's second-best gainer, rising for a third trading day, and closing at its highest level in more than six months.

"We are getting more good news and less bad news," said Abdullah Al-Rashood, chief executive of KSB Capital.

In the United Arab Emirates, Dana Gas extended gains to a second day following its Kurdistan gas deal and closed at its highest level since November 6. Dubai's bourse rose by more than 1 percent led by real estate and construction stocks while banks guided Oman higher.

Kuwait rose for a third trading day led by Mobile Telecommunications Co. (Zain) after it gained majority control of Palestine Telecommunications Co. (Paltel) on Monday.

Bahrain's Gulf Finance House dropped 9.17 percent after it posted at loss of 37.7 million in the first quarter.

The firm's shares in Kuwait fell 7.69 percent.

Bahrain was the only market to fall and suffered its biggest one-day decline in almost a month.

The benchmark Qatari index closed 1.98 percent higher at 6,688 points.

Industries Qatar advanced 2.27 percent and Al-Khaliji Commercial Bank climbed 4.28 percent.

The Kingdom's Tadawul All-Share Index (TASI) rose 1.38 percent to 6,063 points.

The positive sentiment was clear across almost all sectors, except the Hotel & Tourism sector, which saw a loss of 0.09 percent.

Sector gains on the other hand ranged from 0.63 percent in the Banking sector to 4.52 percent in Media.

Furthermore, yesterday's gains were supported by a strong liquidity of SR10.8 billion, with a strongly positive market; 107 advancers to 18 decliners led to an AD ratio of 5.94, the Jeddah-based Financial Transaction House (FTH) said in its market report.

Saudi Basic Industries Corp.(SABIC) advanced 2.26 percent and Al-Rajhi Bank 1.79 percent.

"Even though SABIC has closed with gains of over 2 percent, it still ended at the low range for the day, which may have a negative implication on the stock for the coming days," Faisal Alsayrafi, managing director and CEO of FTH, said.

Meanwhile, Morgan Stanley began coverage of Etihad Etisalat (Mobily) with an "overweight" rating and its rival Saudi Telecom Co. (STC) with an "equal weight" rating.

Mobily, Saudi Arabia's second largest mobile-phone firm, is best placed to drive earnings surprises as it increases its presence in the post-paid and data markets, Morgan Stanley said in a note to clients. It named Mobily its top pick in the sector and set a price target of SR47.5 on the stock.

Morgan Stanley said STC, in comparison with Mobily, was facing competitive pressures in its home market and foreign-exchange exposure was a potential drag to its earnings in 2009.

Morgan Stanley set a price target of SR57 on the shares of STC.

The Dubai stock index rose 1.16 percent to 1,665 points.

Emaar Properties gained 2.72 percent and Arabtec 3.15 percent.

Muscat's measure closed 1 percent higher at 5,440 points.

Oman International Bank gained 3.19 percent and Bank Muscat 2.08 percent.

The Abu Dhabi index edged 0.91 percent higher to 2,616 points. Dana Gas climbed 6.38 percent and First Gulf Bank 3 percent.

The Bahrain stock index fell 1.29 percent to 1,631 points. Ahli United Bank declined 1.75 percent.


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