JEDDAH — Saudi Arabia's stock market fell on Monday after reports that Riyadh had sent a ground "strike force" including tanks toward its border with Yemen, while Dubai came under pressure from several disappointing first-quarter earnings reports. Saudi Arabia stocks were lower after the close on Monday. Losses in the Media & Publishing, Petrochemicals and Real Estate Development sectors led shares lower.
At the close in Saudi Arabia, the Tadawul All Share declined 1.31%.
The best performers of the session on the Tadawul All Share were Kingdom Holding Company, which rose 5.91% or 1.20 points to trade at 21.50 at the close. Meanwhile, Tourism Enterprise Co. added 3.57% or 1.74 points to end at 50.50 and Allied Cooperative Insurance Group was up 2.97% or 1.10 points to 38.10 in late trade.
The worst performers of the session were Saudi Indian Company Insurance, which fell 7.11% or 1.45 points to trade at 18.95 at the close. Al Sorayai Trading&Industrial Group declined 4.29% or 0.94 points to end at 20.95 and Food Products Co. was down 4.13% or 1.63 points to 37.80.
Falling stocks outnumbered advancing ones on the Saudi Arabia Stock Exchange by 145 to 18. Crude oil for June delivery was unchanged 0.00% or 0.00 to $59.39 a barrel. Elsewhere in commodities trading, Brent oil for delivery in July fell 0.68% or 0.45 to hit $65.71 a barrel, while the June Gold contract rose 0.02% or 0.20 to trade at $1189.10 a troy ounce.
In the afternoon, the Saudi-owned Al Arabiya Hadath TV channel broadcast pictures of a column of tanks loaded onto military trucks and described it as "the arrival of reinforcements from the strike force to the border".
The Saudi-led air campaign against Houthi rebels in Yemen has been a small but significant source of concern for Saudi retail investors, and any escalation into a ground campaign would be seen as negative by the market, at least initially.
The main Saudi stock index, which had earlier in the day traded nearly flat, responded to the strike force reports by falling 1.3 percent. Oil prices were another negative factor. Brent crude slipped below $65 per barrel as signs that US shale oil production was recovering after a recent price rally renewed concern about a global supply glut.
Petrochemicals giant Saudi Basic Industries, whose profits tend to rise and fall in line with oil prices, dropped 3.2 percent.
The biggest gainer of the day was investment firm Kingdom Holding, which surged 6.2 percent to a seven-week high of SR21.55. The firm's assets include a stake in a development company which is building the world's tallest tower in the city of Jeddah, and whose chief executive told Reuters on Sunday that residential apartments at the tower would likely go on sale later this year.
Dubai's index was the biggest loser in the region after some local companies posted weaker-than-expected first-quarter profits.
The emirate's benchmark fell 1.8 percent and developer Union Properties tumbled its daily 10 percent limit to 1.21 dirhams after saying its first-quarter profit had fallen to 28.1 million dirhams ($7.7 million) from 179.8 million dirhams a year earlier. The stock broke technical support around 1.28 dirhams, where it had peaked in late December and January; its next major chart support is around the February peaks of 1.12 dirhams.
Low-cost carrier Air Arabia fell 1.9 percent after posting a 9 percent year-on-year increase in first-quarter profit. Analysts had expected that cheaper fuel would help the company boost its profit by almost by a third.
Builder Arabtec, whose earnings are expected later this week, tumbled 4.8 percent. Most other stocks also fell, although Emaar Malls was flat, buoyed by expectations that it will secure a place in MSCI's emerging markets index following the index compiler's semi-annual review this week.
MSCI bets also supported Abu Dhabi's bourse, which edged up 0.3 percent. First Gulf Bank, whose weighting in the MSCI index may increase, rose 1.7 percent and Union National Bank, which may secure a place in the benchmark for the first time, added 0.8 percent.— SG/Reuters
