Monday, 05 November 2012 19:34
DUBAI: Kuwait's market made its largest one-day gain in eight months on Monday, rebounding from an eight-year low as investor confidence improved after a political protest was less violent than investors had feared, while other Gulf bourses ended mixed.
Kuwaiti security forces fired tear gas to disperse an unauthorised demonstration on Sunday by thousands of opposition supporters. The country will hold parliamentary elections on Dec. 1.
"I doubt there will be demonstrations until the elections -that's giving relief to small investors to put money back into the market," said Fouad Darwish, head of brokerage at Global Investment House.
The index finished 1.6 percent higher, gaining the most in a single session since Feb. 19.
Market participants say the government has been buying local shares through a state-linked fund, which was set up to support the bourse during slumps.
"If the government maintains buying through the national portfolio fund, it will help catapult the market," Darwish added.
Large-caps rallied, with National Bank of Kuwait up 1 percent, telecoms operator Zain gaining 1.4 percent and logistics firm Agility rising 2.1 percent.
In Saudi Arabia, the index climbed for a fourth-straight session, up 0.4 percent. Small-cap stocks led gains as investors skirt risk ahead of Tuesday's US elections.
Retail investors targeted stocks driven by domestic demand, rather than those more affected by global sentiment.
Insurance stocks dominated trade, accounting for nearly half the market turnover of 5.4 million riyals. The sector's index slipped 0.5 percent.
Almarai Co climbed 1.1 percent after announcing plans to issue the second tranche of a riyal-denominated Islamic bond programme in the coming months to private investors.
The banking sector index and petrochemical benchmark added 0.7 and 0.2 percent respectively.
Elsewhere, Abu Dhabi's benchmark slipped 0.3 percent, its second-straight decline since Thursday's 15-month high.
Dana Gas ended 2.4 percent lower at 0.41 dirhams, having slumped as much as 7.3 percent intraday. The stock accounted for nearly half of all shares traded on the bourse.
The natural gas producer failed to repay a $920 million sukuk on maturity last week, prompting a source close to holders of the bond to say they will stake claim Dana's extensive Egyptian assets.
Dana said in a statement after trading it was unaware of any action by bondholders against the firm.
"It's no surprise that creditors will enforce the security on the sukuk. Egypt assets were the recourse on the sukuk in case of default," said Anastasios Dalgiannakis, institutional trading manager at Mubasher.
"Assuming they don't commit other assets for the security of the sukuk during negotiations, Dana's stock is worth more than the current price."
Dubai's benchmark shed 0.4 percent to its lowest close since Oct. 2.
Elsewhere, Qatar's measure ended flat and Oman's benchmark was 0.3 percent down. Bahrain's bourse gained 0.4 percent, its second successive advance since hitting its lowest level since June 2003 at the end of last week.
Copyright Reuters, 2012