World Markets

MIDEAST STOCKS-Banks hurt Saudi; other major Gulf markets up

Credit: REUTERS/FAISAL AL NASSER

Saudi stocks slipped on Thursday, extending losses for the second straight session pressured by banking shares, as receding fund inflows continued to keep investors at bay while other major Gulf markets rose.

Aug 29 (Reuters) - Saudi stocks slipped on Thursday, extending losses for the second straight session pressured by banking shares, as receding fund inflows continued to keep investors at bay while other major Gulf markets rose.

On Wednesday, a second batch of Saudi shares was added to the MSCI emerging markets index but the move failed to lift the market as funds remain bearish.

Sixty percent of fund managers said they would reduce their investments in Saudi Arabia, displaying bearishness that has carried over from last month.

The Saudi index .TASI fell 0.3% with Banque Saudi Fransi 1050.SE declining 1.1% and Saudi Basic Industries 2010.SE losing 0.4%.

On Wednesday, investment bank EFG Hermes said in a note that the investment case for Saudi banks is no longer "compelling" in their view on the backdrop of receding passive flows, rates becoming a headwind, and the emergence of credit quality concerns.

In Qatar, the index .QSI increased 0.8%, led by a 2% rise in lender Masraf Al Rayan MARK.QA and a 1.4% gain in Industries Qatar IQCD.QA.

The Dubai Financial Market General Index .DFMGI was up 0.2%, helped by financial stocks. Dubai Islamic Bank DISB.DU, the United Arab Emirates’ largest sharia-compliant lender, and Dubai Investments DINV.DU both were up 0.8%.

Abu Dhabi index .ADI also rose 0.2%, largely driven by Emirates Telecommunications ETISALAT.AD, which was up 0.6%.

Middle Eastern funds plan to increase their investments in UAE, according to a Reuters poll.

(Reporting by Ateeq Shariff in Bengaluru Editing by Mark Heinrich)

((AteeqUr.Shariff@thomsonreuters.com; +918067497129;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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