Jan. 27 (Bloomberg) — Persian Gulf shares rose, led by Emirates Telecommunications Corp. and Dubai Islamic Bank PJSC, on speculation companies will report a surge in earnings this week. PetroRabigh soared after its initial public offering.
Emirates Telecommunications, known as Etisalat, announces results Jan. 29. Dubai Islamic Bank, the biggest bank in the country complying with Islamic banking rules, also may report earnings this week, according to Bloomberg data. Companies in the Persian Gulf are benefiting from oil prices above $90 a barrel.
“Investors expect annual earnings of Etisalat and Dubai Islamic to be quite robust, something in the region of 30 and 50 percent growth respectively,” Mohamed Dwaikat, a senior broker at Abu Dhabi-based Al-Fajer Securities, said in a phone interview today. “On top of that, Etisalat is quite cheap at the moment.”
The Abu Dhabi Securities Market Index added 2.2 percent to close at 4,683.21, bringing the three-day advance to 8.9 percent. The Dubai Financial Market General Index increased 1.2 percent, while Saudi Arabia’s Tadawul All Share Index climbed 3 percent to 9,713.66 at 3 p.m. in Riyadh.
Etisalat, the U.A.E.’s largest phone company, jumped 5.2 percent to 24.5 dirhams. The stock trades at 18 times estimated earnings, according to data compiled by Bloomberg. That compares with an average of 19 for members of Abu Dhabi’s benchmark. Etisalat shares have risen 6.3 percent this year.
Dubai Islamic Bank added 1.4 percent to 10.95 dirhams.
The Gulf Cooperation Council states, which together pump a fifth of the world’s oil, are earning more than $1.3 billion a day with crude above $90 a barrel. Economies in the gulf will expand at a faster rate in 2008 than last year, EFG-Hermes Holding SAE said in a report.
Economic Growth
The U.A.E.’s real gross domestic product expanded by 8.9 percent in 2006. Saudi Arabia’s economy grew at 4.3 percent. The six GCC countries are the U.A.E., Saudi Arabia, Kuwait, Qatar, Oman and Bahrain. Crude oil for March delivery rose 1.5 percent to $90.71 a barrel in New York Mercantile Exchange trading on Jan. 25.
PetroRabigh, the chemicals and refining complex being built by Saudi Aramco and Sumitomo Chemical Co., more than doubled to 48.25 riyals in the first day of trading after its 4.6 billion- riyal IPO. The shares were sold at 21 riyals.
“There is a sense of optimism about new listings such as PetroRabigh because it will give more depth to the Saudi market,” Azzam Albraikan, head of brokerage at Saudi Swiss Securities, said in a phone interview today.
Saudi Chemical Co. advanced 2.5 percent to 30.75 riyals. The Saudi distributor of drugs made by AstraZeneca Plc and GlaxoSmithKline Plc bought 20 percent of Philadelphia-based ExploTrack Inc., which makes systems for tracking and securing explosives.
The Kuwait Stock Exchange Index rose 0.6 percent, climbing for a third day. Gulf Insurance Company KSC rallied 5.6 percent to 950 fils. The Kuwaiti insurer’s full-year net income surged to 37.6 million dinars compared with 8.3 million in 2006, according to a statement posted on the Web site of the Kuwaiti bourse.
Qatar’s Doha Securities Market Index added 0.9 percent, while Oman’s Muscat Securities Market 30 Index gained 1.7 percent. The Bahrain All Share Index increased 0.2 percent.
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