Persian Gulf Shares Retreat, Led by Dubai Investments, Taqa

By Zainab Fattah

July 13 (Bloomberg) -- Persian Gulf shares declined, tracking global markets as foreign investors moved away from riskier assets.

Dubai Investments PJSC fell to its lowest in more than three months. Abu Dhabi National Energy Co., known as Taqa, also declined. Commercial Bank of Qatar QSC lost for a third day.

``Foreign investors, especially hedge funds, are moving away from risky assets by reducing their exposure to equity markets globally,'' Kamran Butt, head of Middle East equity research at Credit Suisse Group AG, said in a telephone interview from Dubai. ``Combine that with geopolitical risk and the fact that Gulf markets are not the most cheaply valued right now and you can see why markets are falling.''

Stocks last week fell around the globe, giving the MSCI World Index a 20 percent bear-market decline from its October record, as oil reached $147 a barrel and concern deepened that Fannie Mae and Freddie Mac are short of capital.

The Dubai Financial Market General Index dropped 1.1 percent to 5,287.63, its lowest since March 30. The Abu Dhabi Securities Exchange General Index lost 1.4 percent, while Qatar's Doha Securities Market Index slid 1.8 percent.

Multiples

The MSCI GCC Countries Index, a measure of 115 companies in six Gulf states, trades at an average of 17 times estimated earnings, according to data compiled by Bloomberg. That compares with a multiple of 11 for the MSCI Emerging Markets Index.

The U.S. has intensified its push for tougher sanctions on Iran in a dispute over the country's nuclear program. Last week, the Iranian military test-fired a long-range Shahab-3 missile, with a 2,000-kilometer (1,240-mile) range and a 1-ton weight capable of reaching Israel, to demonstrate its power.

Dubai Investments, which owns stakes in more than 40 companies, declined 3.7 percent to 3.62 dirhams. The stock closed at its lowest since March 30.

Taqa, the state-controlled investment company, lost 4.5 percent to 2.79 dirhams. Commercial Bank of Qatar, the Persian Gulf country's second-biggest bank by assets, retreated 3.4 percent to 137.8 riyals.

Gulf Pharmaceutical Industries PJSC slid 5.3 percent to 2.32 dirhams. The U.A.E.-based medical supplies-maker known as Julphar said Chief Executive Officer Abdul-Razzak Yousef resigned for personal reasons, according to a statement posted on the Web site of Abu Dhabi's bourse today.

Saudi Shares Gain

Saudi Arabia's Tadawul All Share Index advanced 1.7 percent, gaining for the first time in four days.

Saudi Basic Industries Corp. rose 2.6 percent to 136.25 riyals. The world's biggest chemicals maker by market value agreed to market through its Chinese unit polyolefin products produced by a Saudi Aramco venture in China.

Bank Albilad surged 6.7 percent to 40 riyals. The second- smallest Saudi Arabian bank by market value said second-quarter net income advanced 64 percent to 57 million riyals ($15.5 million) on income from investments and commissions.

National Metal Manufacturing & Casting Co. jumped 9.8 percent, the biggest surge in three months, to 67 riyals. The Saudi maker of industrial wires and steel products said net income more than tripled to 28.6 million riyals, according to a statement posted on the Web site of the Saudi bourse.

Oman Cables Climbs

The Kuwait Stock Exchange Index increased 0.5 percent, while the Bahrain All Share Index lost 0.1 percent. The Muscat Securities Market 30 Index gained 0.3 percent.

Oman Cables Industry SAOG jumped 6.1 percent to 4.191 rials, its biggest one-day gain since Feb. 26. The maker of wires and cables said first-half net income more than doubled to 11.5 million rials ($29.9 million), according to a statement posted on the Web site of the Omani bourse today.

United Development Co. gained 1.3 percent to 62.7 riyals. The Qatari developer building man-made islands off the emirate's coast said first-half net income almost doubled to 241 million riyals ($66.2 million).

InvestBank PSC rose 1.5 percent to 3.5 dirhams. The lender based in Sharjah, the U.A.E., said second-quarter net income jumped 57 percent to 78.2 million dirhams ($21.3 million) on higher interest and fee income.

To contact the reporter on this story: Zainab Fattah in Dubai on zfattah@bloomberg.net.