Mideast Stocks: Gulf markets end mixed on earnings, US rate outlook

Mideast Stocks: Gulf markets end mixed on earnings, US rate outlook

Stock markets in the Gulf ended mixed on Thursday, following a slew of upbeat corporate earnings, while regional tensions and dampened hopes of early rate cuts by the U.S. Federal Reserve weighed on sentiments.

Saudi Arabia's benchmark index gained 0.4%, with Americana Restaurants International surging 9.8% — its biggest intraday gain since December 2022. 

The fast-food restaurant operator in the Middle East and Kazakhstan declared a one-time special dividend alongside a regular annual payout. Americana, primarily listed on Abu Dhabi bourse, reported full-year net profit attributable to shareholders of $259.5 million, little changed from 2022. 

Separately, Saudi Arabia's Modern Mills Company is seeking to raise up to 1.178 billion riyals ($314.12 million) from its planned initial public offering priced between 44 riyals and 48 riyals a share.

In Abu Dhabi, the index edged up 0.1%, helped by an 11.1% jump in Americana Restaurants International.

Dubai's main share index added 0.4%, with blue-chip developer Emaar Properties rising 0.6%, while Union Properties advanced 14.9%. 

Union Properties, which saw its biggest intraday gain since July, on Wednesday recorded an annual net profit of 811 million dirhams ($220.82 million), up from 30 million dirhams in 2022.

The Qatari benchmark dropped 0.6%, weighed down by a 1.2% fall in Qatar Islamic Bank and a 1.3% decrease in petrochemical maker Industries Qatar. 

Data On Tuesday showed U.S. core consumer prices in January stayed at nearly double the Fed's 2% target, forcing investors to reassess their rate cut expectations.

Most Gulf currencies are pegged to the dollar. Qatar, Saudi Arabia and the United Arab Emirates usually mirror any monetary policy change in the United States.

Outside the Gulf, Egypt's blue-chip index was up 0.2%.

#UAE Backs Sam Altman Idea to Turn Itself into AI Testing Ground - Bloomberg

UAE Backs Sam Altman Idea to Turn Itself into AI Testing Ground - Bloomberg

The United Arab Emirates will push to become a global leader in testing and regulating artificial intelligence technology, according to a top official, echoing remarks from OpenAI’s Chief Executive Officer Sam Altman earlier this week.

Altman’s belief that the UAE can become the “hub for pragmatic regulation” shows the “UAE is a serious player” in the AI space, the UAE’s Minister of State for Artificial Intelligence Omar Al Olama told Bloomberg in an interview at the World Government Summit in Dubai on Thursday. “That is an opportunity I personally want to see happen, it is something we are going to push for.”

Altman, who is courting investors in the Middle East, said at the same conference that the Gulf country could serve as the world’s “regulatory sandbox” — a place to experiment with AI technologies and later spearhead global rules limiting their use.

The UAE has invested heavily in AI and made it a key policy consideration, but its ties to China have raised some concern in the US. Earlier this week, Emirati AI company G42 told Bloomberg it would scale back its presence in China to appease Washington.

Al Olama described the UAE as a “very strong partner” to the US. “All our technological foundations and infrastructure have been related to American companies, that is not going to change anytime soon,” he said.

But that partnership won’t rule out working with Chinese companies, the minister added. “I don’t think you can say you need one and don’t need the other.”

A massive influx of tech workers since 2021 is helping fuel the Gulf state’s AI ambitions. As of September, there were 120,000 people working on AI or AI-related industries — up from 30,000 two years prior, Al Olama said.

#Dubai's DIFC attracts broader range of new tenants | Reuters

Dubai's DIFC attracts broader range of new tenants | Reuters

The Dubai International Financial Centre (DIFC) saw 34% growth in new registrations last year, helped by demand from companies in a broader range of sectors and new industries such as fintech, boosting the city's status as the Gulf financial hub.

DIFC posted a net profit of $203 million in 2023, up about 45% year on year, while combined revenue rose 23% to $352 million, it said on Thursday.

The total number of active companies stood at 5,523 at the end of 2023.

"The overall growth of companies has been supported by both financial and innovation companies and non-financial companies," DIFC Governor Essa Kazim told reporters.

There is increasing competition among Gulf states to develop their financial sectors as part of economic diversification, with the likes of Abu Dhabi, Riyadh and Doha bolstering investment in their own financial centres.

Kazim said he was not concerned about competition from Saudi Arabia, the Arab world's largest economy, or others when it came to attracting companies, and that economic growth across the region meant the pipeline was growing bigger for everyone.

#SaudiArabia IPO: Modern Mills Holders Seeking to Raise $314 Million - Bloomberg

Saudi Arabia IPO: Modern Mills Holders Seeking to Raise $314 Million - Bloomberg

Investors snapped up all of the shares in Saudi Arabia’s Modern Mills for Food Products Co. initial public offering shortly after books opened, showing that demand for regional listings is still strong.

Books were covered throughout the price range of 44 riyals to 48 riyals per share in the IPO that could raise as much as 1.2 billion riyals ($314 million), according to terms of the deal seen by Bloomberg News. At the top end of the range, the firm would be valued at $1 billion, according to a statement on Thursday.

The selling shareholders Mada International Holding Co., Al Ghurair Foods, and Masafi Co. are offering 24.5 million shares in the offering, or a 30% stake in the company.

Bookbuilding for institutional investors will run until Feb. 21, with pricing set for Feb. 27. Retail investors will be able to bid between March 5 and 6.

United Arab Bank posts 65% growth in 2023 net profits

United Arab Bank posts 65% growth in 2023 net profits

United Arab Bank (UAB) on Thursday posted a net profit of Dh255 million for the financial year 2023 compared to a net profit of Dh155 million in 2022, representing an increase of 65 per cent.

In a statement, the bank said growth in net profit is a result of improved operating performance and lower expected credit losses, coupled with disciplined cost management.

UAB’s financial performance was aided by significant progress across the core businesses with total operating income recording a 15 per cent growth in financial year 2023 as compared to 2022 and are expected to improve further with new portfolio underwritings in quality assets.

Total assets grew 25 per cent year-on-year basis last year to Dh17.6 billion, driven by the strong growth in loans, advances and Islamic financing (+23 per cent year-on-year basis), as well as in the investments portfolio (+31 per cent year-on-year basis).

Augmented by the Additional Tier 1 capital issuance of $150 million during the first quarter of 2023, the bank continues to maintain a solid capital adequacy ratio of 19 per cent and a CET1 ratio of 13.5 per cent, both of which remain well above the regulatory requirements, and supporting credit growth ahead. NPL ratio notably improved from 8.2 per cent in fiscal year 2022 to five per cent in 2023.

Mideast Stocks: Most major Gulf bourses gain on strong earnings

Mideast Stocks: Most major Gulf bourses gain on strong earnings

Major stock markets in the Gulf rose in early trade on Thursday following a slew of upbeat corporate earnings, although regional tensions and dampened hopes of early rate cuts by the Federal Reserve limited gains.

Saudi Arabia's benchmark index was up 0.4%, with oil behemoth Saudi Aramco rising 0.6%, while dual-listed operator Americana Restaurants International jumped about 10% after it set a one-time special dividend alongside annual regular payout.

The fast food restaurant operator in the Middle East and Kazakhstan reported full-year net profit attributable to shareholders of $259.5 million, little changed from 2022.

Separately, Saudi Arabia's Modern Mills Company is seeking to raise up to 1.178 billion riyals ($314.12 million) from its planned initial public offering priced between 44 riyals and 48 riyals a share.

In Abu Dhabi, the index added 0.2%, led by a 13.5% surge in Americana Restaurants International.

Dubai's main share index edged 0.1% higher, helped by a 0.6% increase in top lender Emirates NBD, while Union Properties soared 12.4%, its biggest intraday rise since July if the gains hold.

The real estate developer on Wednesday recorded an annual net profit of 811 million dirhams ($220.82 million), up from 30 million dirhams in 2022.

The Qatari benchmark dropped 0.4%, as most of its constituents were in negative territory including Qatar Islamic Bank, which was down 1.3%.

Elsewhere, Gulf International Services slid 5.4%, falling the most since September, despite posting a rise in full-year profit.

Data On Tuesday showed U.S. core consumer prices in January stayed at nearly double the Fed's 2% target, forcing investors to reassess their rate cut expectations.

Most Gulf currencies are pegged to the dollar, and Qatar, Saudi Arabia and the United Arab Emirates usually mirror any monetary policy change in the United States.