Dubai Stocks Fall in Mixed Trading; Kuwait Retreats: Inside EM

(Bloomberg) -- Stocks in Dubai dropped the most in a week amid mixed share trading across the Middle East and Gulf region.

The DFM General Index retreated as much as 2.7% before ending 1.1% lower while the main gauge in Qatar advanced 1.2%. Kuwaiti stocks dropped for a second day, also finishing 1.1% lower, after the country imposed a 20-day full curfew as it recorded 641 new Covid-19 cases Friday, its biggest daily increase.

In Dubai, Emirates Group, which operates the world's largest long-haul carrier, reported a 28% decline in full-year profit as the impact of the coronavirus cut into earnings in March.

“Emirates Group results are definitely playing a role in the market, combined with other companies results,” said Ali El Adou, head of asset management at Daman Investments in Dubai. “In the region, I'm not seeing a reason to be optimistic for the short term due to low oil prices, pressure on budget spending and recovery in travel and tourism not taking off soon. What will change the situation is a combination of economies opening and gradual normalization in oil prices”

Middle East investors are looking ahead to oil giant Saudi Aramco's earnings announcement on May 12. The company still appears committed to its dividend policy for now, which is “encouraging,” according to Salih Yilmaz, an analyst with Bloomberg Intelligence in London. The stock advanced 0.5% in Riyadh on Sunday.

“Dividends are under the spotlight now after Shell cut its payout for the first time since World War II,” Yilmaz wrote in a note. “Before cutting dividends -- which are expected to total $75 billion this year for Aramco -- capital-spending revision is the most-efficient financial lever it's likely to pull.”

MIDDLE EASTERN MARKETS:

• In Dubai, Aramex fell as much as 5% after reporting net income for the first quarter of 67.4 million dirhams, -38% Y/y. It closed unchanged at AED 3.03
  • CEO Bashar Obeid said that it is too soon to say with certainty how severe and lasting the impact of the pandemic will be on the business
• Abu Dhabi Commercial Bank rose for the first time in in nine sessions, up 1.5%
  • Lender said it will “aggressively” cut costs after setting aside 1.88 billion dirhams ($512 million) in provisions to cover bad loans
  • READ: ADCB Savings and Relaxed Rule Mask Crisis Cost: Earnings Outlook
  • The main gauge in Israel gains 1.5% as of 1:22 p.m. in Tel Aviv, the most in the Middle East
    • MORE: Israel Seeks to Boost Virus Aid Package to 100 Billion Shekels

    MORE EARNINGS:

    • Emirates Group Profit Drops 28% as Virus Cuts into March Income
      • Emirates Looking for More Financing After Raising $1.2 Billion
    • ADIB 1Q Impairments 387.1 Mln Dirhams Vs. 186.4 Mln Dirhams Y/y National Agriculture First Quarter Profit 18.2 Mln Riyals
    • Arabian Cement First Quarter Profit 45.1 Mln Riyals, +22% Y/y
    • Qatar First Bank First Quarter Loss 191.6 Mln Riyals

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