Qatari stocks climbed to a high of more than two years on Monday following strong growth figures and on hopes of generous dividends, while regional bourses were mixed. Qatar Navigation jumped 7 percent while Qatar National Bank rose 3.2 percent and Industries Qatar added 2.6 percent. The index climbed 1.5 percent to 8,873 points, its highest close since September 2008.
"Qatar navigation results are expected to be better than 2009, after the merger with Qatar Shipping," said Hani Girgis, assistant chief dealer with Dlala Brokerage. "The profit for Qatar Shipping will be better (and benefit Qatar Navigation). Some of the stocks which are gaining are also because they pay good dividends to investors." On Monday, Qatar Statistics Authority released third-quarter nominal gross domestic product data showing a 21.1 percent rise on an annual basis and a 13.1 percent increase from the previous quarter.
Abu Dhabi's index and Oman's benchmark also advanced, with the latter rallying on optimism over a $78 billion five-year government development plan. Galfar Engineering advanced 1.8 percent and Oman Cables Industries gained 2.1 percent. "Galfar is amongst gainers as investors believe that the company will be beneficiary of increasing government spending," said Gunjan Gupta, head of research at Oman Arab Bank. "Institutional investors are back in action and focusing on high dividend yielding stocks."
In Egypt, a church bombing that killed 21 people at the weekend dented a reputation for stability that has boosted Egypt's economy. The index fell 0.1 percent to close at 7,073 points after touching a seven-month high of 7,142 points on Thursday. "Any investor would be worried. It is normal since this is a major incident that harms anyone in Egypt," said Hisham Metwalli of Arab Finance Brokerage.
"Protests and clashes that followed the attack also raised concerns on stability." Rising oil prices helped lift major stocks in Saudi Arabia, including heavyweight Saudi Basic Industries Corp which rose 1.4 percent. Mohammad Al Mojil Group jumped 4.7 percent after saying it signed a $52.5 million contract with South Korea's Hyundai Engineering and Construction Co to build an engine oil factory in Abu Dhabi.
But Shuaa Capital warned of possible difficulties ahead for Mojil, saying new contracts were coming in slower than expected. "While we view this breakthrough in Abu Dhabi as a positive, we are of the view that the company is still facing many difficulties with the growth outlook deteriorating faster than expected through 2010," said an analyst note from Shuaa Capital. The Saudi index ended 0.3 percent higher. Dubai's index fell 0.3 percent on profit-taking following the previous session's 2.3 percent gain.