Abu Dhabi and Dubai stocks extended their gains from Sunday, with blue-chips leading the advances with the earnings season in full swing.
Abu Dhabi Securities Exchange picked up 0.3 per cent to 6,092 points in early Monday trades, with Abu Dhabi Islamic Bank the biggest gainer with 1.5 per cent after first-quarter profits more than doubled to Dh608 million. The improved bottom-line was realised on the back of a combination of factors.
Factors driving bottom-line
Revenues expanded reflecting a rebound in UAE economic activity. Operating expenses, on the other hand, dropped around 7 per cent due to successful implementation of initiatives and as the efficacy of its digital strategy helped improve productivity. What also contributed to the bottom-line was a whopping 65.5 per cent drop in net impairment charges to around Dh134 million from Dh387 million a year ago.
Dubai: Dubai and Abu Dhabi stocks headed upward in early trades as robust first-quarter earnings kept the momentum going for the markets, while Qatar Exchange pulled back after undergoing a wide selloff.
Dubai Financial Market eked out 0.4 per cent at 2,616 points with Air Arabia appreciating past 2 per cent after recently announcing plans to resume flights for a number of destinations. That marked a sign that the aviation sector was opening up as parts of the world began to recover from the pandemic on the back of vaccine rollouts, though some other parts of the world slipped into fresh more intensive waves of the virus.
Dubai: Saudi Arabian stocks headed lower with the banking stocks leading the losses after subdued first-quarter results from the sector. Dubai and Abu Dhabi stocks outperformed as the momentum created by the earnings goes on.
Saudi Arabia benchmark index inched down 0.5 per cent at 10,362 points. Riyad Bank retreated 2.8 per cent after the first-quarter profits shrank more than 8 per cent taking a hit from higher total operating expenses coupled with lower total operating income. Impairment charges on investments rose over 4 per cent, though the impairment allowances for credit losses dropped to SR249 million from SR303 million it took on, for the corresponding period last year.
Etisalat drove the upsurge in Abu Dhabi stocks in early Thursday trades, with the telco wowing investors with its Dh2 billion plus net profit for first three months of 2021. In Dubai, real estate stocks reversed recent losses.
Abu Dhabi Securities Exchange traded 0.1 per cent higher at 6,088 points, with Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank and Sharjah Islamic Bank benefitting from upbeat sector results. But the index received its biggest boost from Etisalat.
It gained as much as 1.2 per cent at one point, but has since shed some of the momentum and is now up 0.2 per cent.
The telco late on Wednesday reported an 8 per cent uptick in first-quarter bottom-line to Dh2.3 billion, mainly on the back of lower impairment losses of trade receivables and contract assets coupled with better contributions from associate companies. Profits were, however, squeezed a bit as operating expenses increased 4 per cent to Dh8.4 billion.
Saudi market underperformed after banking and petrochemical stocks came under selling pressure, snapping five days of gains, while in Dubai, ex-dividend was a factor behind the slipping into the red.
The Saudi benchmark index tripped up by 1.1 per cent to 10,419 points. Al Rajhi Bank, Saudi National Bank and Riyad Bank headed lower with Saudi Aramco joining in the downside by shedding 1.1 per cent. The petrochemicals giant Saudi Basic Industries (Sabic) retreated 3 per cent despite reporting SR4.86 billion in first-quarter profits, a rebound from year-ago losses amounting to SR1.05 billion.
Retailer and food company Savola Group traded 2.6 per cent lower after the first-quarter profits dipped 11 per cent to SR154 million owing to lower sales and margins in the retail sector. Profit contributions from associate companies also took a hit while operating costs and Zakat and tax expenses moved higher.