Stocks in the United Arab Emirates surged on Thursday, outperforming most major Gulf markets, boosted by strong earnings at top lenders. In Abu Dhabi, the index closed 2.7% higher, buoyed by First Abu Dhabi Bank (FAB), which rose 4% to its highest level since May after posting a 5% rise in second-quarter net profit.
The bank recorded a net profit of 3.2 billion dirhams ($871 million) in the quarter ending June 30, versus 3.06 billion dirhams a year earlier. Similarly, the Dubai index climbed 1.7%, driven by a 2.7% rise in Emirates NBD after the bank announced an 80% jump in second-quarter earnings. The bank made a net profit of 4.74 billion dirhams ($1.29 billion) in the three months to June 30, helped by an asset sale and foreign exchange gains. EFG Hermes had expected a net profit of 4.06 billion dirhams.
The results reinforced signs that top banks in the UAE are managing to withstand strains from a sluggish economy and a property downturn in Dubai. Emirates NBD said on Wednesday it had received permission to open 20 more branches in Saudi Arabia. Egypt's blue-chip index advanced 0.2%, with Cairo Investment and Real Estate Development jumping 6.8%.
Saudi Arabia's main index fell 0.5%, ending eight straight days of gains triggered by EFG Hermes forecasting that profits for the kingdom's financial sector would grow 7.6% in the second quarter. Nine of 11 Saudi banks fell. Al Rajhi Bank lost 0.7%, while National Commercial Bank was down 0.9%.
Qatar's index dropped over 1% with 17 of 20 stocks declining. Commercial Bank plunged 4.5% and Industries Qatar lost 1.5%.