STOCKSNEWSMIDEAST-Fiscal year-end selling pulls Egypt down

1310 GMT - Egypt's benchmark share index .EGX30 closes 1.2 percent lower, with traders saying investors are locking in profits as Egypt's financial year comes to a close, encouraged by bearish analyst comments on the country's economic outlook.

"Ninety percent of this drop is profit taking by retail clients and local institutions as we come to the end of the financial year," says a trader at Pharos Securities.

The EGX30 closes at 5,376 points, its lowest since June 2. It is still 9 percent above a low of 4,935 reached in early May.

Egypt's financial year runs from July to June.

Commercial International Bank (COMI.CA: Quote) drops 3.1 percent and Orascom Construction (OCIC.CA: Quote) closes 1.2 percent lower.

Among the bourse's five most active stocks are Oriental Weavers (ORWE.CA: Quote) and Sidi Kerir Petroleum (SKPC.CA: Quote) due to transfers of holdings in the two companies between local state-controlled banks, traders say.

Sidi Kerir is down 0.3 percent and Oriental Weavers drops 1.2 percent.

Traders also cite research notes focusing on Egypt's slowing economy and expectations that the pound currency -- which dipped against the dollar last week -- may continue to weaken.

They say property stocks rise after an Egyptian citizen who tried to overturn state land sales to Palm Hills (PHDC.CA: Quote) and Saudi's Kingdom Holding (4280.SE: Quote) dropped the actions.

"The news of Hamdy Fakharany withdrawing his claims because the government wouldn't support him made it seem pro-investor, and this is positive for ... real estate," says Ashraf Akhnoukh, senior manager for MENA markets at brokerage CIBC.

Akhnoukh says Egyptian Resorts (EGTS.CA: Quote), one of the sector's most beaten-down stocks, benefits from the news, climbing 5 percent. Palm Hills dips 2 percent.

Egypt's biggest listed developer and the first to face a legal row over a land sale, Talaat Moustafa Group (TMG) (TMGH.CA: Quote), is the bourse's sixth most traded stock with over 33.4 million pounds of its shares changing hands.

It gains 1.2 percent.

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1315 GMT - Saudi Arabia's index ends little changed and investors are waiting for second-quarter earnings season which is expected to begin in two weeks.

The benchmark eases 0.07 percent to 6,507 points, halting two sessions of gains. It is down 3.4 percent in June.

Saudi Kayan Petrochemicals (2350.SE: Quote) eases 1.1 percent but the petrochemical index gains 0.1 percent.

"The only thing that is interesting is the Q2 results, which will create a catalyst," says Haissam Arabi, chief executive and fund manager at Gulfmena Investments. "Q2 (earnings) will be very strong in Saudi."

Saudi British Bank (1060.SE: Quote) gains 1 percent after HSBC Holdings Plc (0005.HK: Quote) (HSBA.L: Quote), Europe's biggest bank said on Monday it will merge its Saudi Arabian wholesale and investment banking business with Saudi British Bank's SABB Securities. [ID:nLDE75Q0IS]

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1110 GMT - Dubai's index edges away from Sunday's three-month low, but Abu Dhabi's benchmark slumps to a two-week low as property and energy stocks slide.

Bellwether Emaar Properties (EMAR.DU: Quote) rises 0.3 percent, Dubai Financial Market (DFM.DU: Quote) gains 1.7 percent and Arabtec (ARTC.DU: Quote) climbs 2.4 percent.

The benchmark advances 0.3 percent to 1,526 points, its first gain since since index compiler MSCI postponed a decision on whether to upgrade the UAE and Qatar to emerging market status to December. [ID:nN1E75K1TG]

Abu Dhabi's benchmark slips 0.5 percent to 2,704 points, its lowest close since June 12.

Aldar Properties (ALDR.AD: Quote) drops 1.6 percent and Sorouh Real Estate (SOR.AD: Quote) slips 2.4 percent. Dana Gas (DANA.AD: Quote) sheds 3.3 percent.
"These are (some of) the stocks that failed to make it to the MSCI -- these are the bluechips everyone was relying on," says Haissam Arabi, chief executive and fund manager at Gulfmena Investments. "We're not expecting remarkable Q2 results from them and there is no recovery in the real estate sector, so you see people selling."

Elsewhere, Qatar's index climbs 0.5 percent to 8,250 points, trimming its June losses to 1.5 percent.

Gainers outnumber loser 14 to five. Qatar National Bank (QNBK.QA: Quote) rises 2 percent in thin trade, with low volumes tending to exaggerate stock moves.

Posted in: Business-Economic