Persian Gulf Shares Fall, Led by Omantel, Emaar Properties

By Zainab Fattah

Aug. 24 (Bloomberg) -- Persian Gulf shares, including Emaar Properties PJSC and Saudi British Bank, declined as investors speculated prices have outpaced prospects for earnings growth.

Emaar Properties, the largest real-estate developer in the Middle East, fell to its lowest in more than three years, while Saudi British Bank ended two days of gains. Oman Telecommunications Co., the sultanate's biggest phone company, slid for a second day.

Oman's Muscat Securities Market 30 Index fell 2.1 percent to 10,245.89. The measure is up 7.4 percent since Aug. 11. The Dubai Financial Market General Index lost 0.2 percent, while Saudi Arabia's Tadawul All Share Index ended nine days of advances, decreasing less than 0.1 percent. The index is up 13 percent since Aug. 10.

``We are witnessing profit-taking, especially in Saudi after the major rally yesterday,'' said Ali Khan, head of equity trading at Dubai-based Arqaam Capital Ltd. ``Foreign investors will divert more and more money to the Saudi market from the rest of the Gulf over the next few days.''

Saudi Arabia's measure yesterday jumped 5.2 percent, the biggest one-day gain since April 2007. On Aug. 20, the market regulator allowed foreign investors greater access to the country's stock exchange, the largest in the Persian Gulf.

Gulf Stocks Expensive

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 Bloomberg data. That compares with a multiple of 11 for the MSCI Emerging Markets Index.

Oman Telecommunications dropped 4.6 percent to 2.095 rials. The shares have jumped 11 percent since Aug. 11 after Oman's Ministry of Finance invited companies to bid for a 25 percent stake in the company. Emaar fell 1 percent to 9.3 dirhams, its lowest since April 2005.

Saudi British Bank, 40 percent-owned by HSBC Holding Plc, lost 1.7 percent to 88.5 riyals.

Mubarrad Transport Co. declined 1.9 percent to 265 fils after the Kuwaiti transport company reported it's in talks about the possible sale of its stake in a unit.

Qatar Declines

Qatar's Doha Securities Market Index slid 0.2 percent, falling for a third day. The Kuwait Stock Exchange Index advanced 0.2 percent, while the Bahrain All Share Index gained 0.4 percent, ending five days of declines. The Abu Dhabi Securities Exchange General Index increased 0.9 percent.

Dana Gas PJSC added 3 percent to 1.74 dirhams. The U.A.E.- based oil and natural-gas producer was rated ``market perform'' in new coverage at Dubai-based Al Mal Capital PSC with a price estimate of 1.95 dirhams.

Sahara Petrochemical Co. rose 1.1 percent to 44.5 riyals. The Saudi producer of propylene and ethylene started trial operations at an olefin plant on Aug. 23, according to a statement posted on the Web site of the Saudi bourse today.

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