DUBAI, June 17 |
DUBAI, June 17 (Reuters) - Saudi Arabia's main stock index rose on Sunday, recovering the previous day's losses as the death of the kingdom's crown prince ceased to have an impact.
Qatar's index was again weak and Bahrain steady, while markets in the United Arab Emirates, Kuwait and Oman were closed for a religious holiday. Egypt was also shut for the country's presidential election.
Saudi Arabia's benchmark rose 0.4 percent. It fell 0.3 percent on Saturday, having been down as much as 2.6 percent intra-day in a knee-jerk reaction to Crown Prince Nayef's death eight months after he became heir to the throne. The index is now down 14.8 percent from early April's 3-1/2 year peak, as declines in oil and world equity prices have spurred local selling.
"Yesterday's volatility was to be expected when we have this kind of news, but the market then recovered and I don't think it will be major factor today - Prince Nayef was known to have had health problems so his death wasn't a complete surprise," said a Riyadh-based fund manager, asking not to be identified.
"The authorities will probably give some clarity on the succession soon and today's trading will be more linked to what's happening outside the region."
Although Nayef was known for his strong management of security issues in the country, analysts see no reason to think foreign or political policies, much less economic policies, will change under his successor.
Gains in world markets on Friday helped support Saudi sentiment. Investors fear Sunday's Greek elections could unleash fresh turmoil in the euro zone if the next government in Athens scraps Greece's bailout deal, but this is offset by hopes that the world's major central banks will make a coordinated response to ease any market dislocation.
In Saudi Arabia, shares in telecoms operator Etihad Etisalat (Mobily) climbed 2 percent and Saudi Basic Industries Corp rose 0.8 percent. Saudi firms are expected to start announcing second-quarter earnings from early July.
"Q2 results will help at least to stabilise the market, but these will be of secondary importance compared with what's happening in Europe, which is flitting between risk-on and risk-off mode," said the fund manager.
"We should see some buying in select names ahead of results, particularly petrochemicals - people are expecting bad results, but not as bad as recent price movements would justify."
The petrochemicals index climbed 0.4 percent, trimming its year-to-date losses to 4.7 percent. The sector has loosely tracked declines in oil prices, with crude seen as a key indicator for both petrochemical product prices and likely demand.
QATAR
In Doha, the main index slipped 0.01 percent to its lowest close since Oct. 6. This took its 2012 losses to more than 6 percent, making it the worst performing Gulf Arab benchmark. About 1.83 million shares traded, the lowest total since July 2011.
"Volumes have been going down lately and I don't think it will get better anytime soon," said a Doha-based trader on condition of anonymity.
"Foreign investors have been selling aggressively to invest in other markets and Qatar trading has slumped - things look anaemic, with a lack of catalysts and better opportunities for investors elsewhere."
Vodafone Qatar fell 0.3 percent. The loss-making telecommunications operator is among the top-performing Doha-listed stocks this year, rising nearly 20 percent, but has fallen 2.5 percent since June 7, when it reported a fourth-quarter net loss of $35 million, missing an analyst's estimate.
NBK Capital last week cut its rating on Vodafone Qatar to hold from accumulate.
SUNDAY'S HIGHLIGHTS
SAUDI ARABIA
* The index rose 0.4 percent to 6,754 points.
QATAR
* The benchmark slipped 0.01 percent to 8,251 points.
BAHRAIN
* The measure rose 0.1 percent to 1,132 points.
Money laundering cases tough, critical - Lubbock Avalanche-Journal
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McALLEN — When it comes to arresting drug traffickers and dismantling organized crime, the investigation into a U.S. horse racing operation allegedly laundering money for one of Mexico’s most powerful cartels is rare — and difficult to ...Business groups warn Welsh government on 'living wage' - BBC News
The Welsh government is looking at how devolved public sector bodies could be encouraged to become 'living wage' employers.
Business leaders have warned the Welsh government not to push for private sector pay rises as ministers investigate public sector wage levels.
Labour has a manifesto commitment to find ways of making sure all Welsh workers are paid a "living wage".
Business groups say it may stop firms taking on staff or even mean layoffs.
The Welsh government says it is beginning to examine how devolved public sector employers can be encouraged to pay a living wage.
A policy group of interested parties is expected to meet over the summer.
“Start Quote
End Quote Robert Lloyd Griffiths Institute of DirectorsI'm afraid it just isn't realistic in the environment we live in”
Academics at Loughborough University have estimated a living wage is at least £7.20 an hour. The current statutory minimum wage is £6.08 an hour for workers aged 21 and over.
Welsh NHS workers and Welsh government civil servants are already paid at least the living wage.
A number of big private sector employers, including Barclays Bank and accountants KPMG, are also signed up to paying it.
But business organisations warned Welsh ministers not to try to force them to raise wages, for example by inserting living wage clauses in government contracts.
Robert Lloyd Griffiths of the Institute of Directors said he was concerned the living wage would effectively become the new minimum wage.
"Businesses would like to take on more staff and lots of companies that I talk to would love to be in a position to be able to take on more employees," he said.
'Very difficult'"It's very difficult out there and anything that now will hinder them from doing that, which they'd like to do, is going to cause problems.
"I'm afraid it just isn't realistic in the environment we live in."
Anna Milewski, of the Federation of Small Businesses, said: "We have to look at it from the employers' perspective, we've surveyed them.
"They say that an increase can, at best, deter them from taking on staff at worst actually result in them laying off staff, which would not be a positive outcome, of course."
“Start Quote
End Quote Julie James Labour AMIf we're the trailblazers we hope the private sector won't be so frightened of it”
The Welsh government said: "Unlike the minimum wage, the living wage is not statutory.
"However, any employer in the UK is free to sign up to the Living Wage Foundation's campaign. The Welsh government is starting to look at how devolved public sector organisations have been engaging with the idea and what it would take to encourage those organisations to become living wage employers.
"This is a key reason the Minister for Local Government and Communities [Carl Sargeant] has decided to set up a policy group, so that consideration of the benefits, in much the same way as they were in London, can be given collaboratively. That group has yet to be brought together, but it is anticipated that this will happen over the summer."
Labour AM Julie James said: "If we're the trailblazers we hope the private sector won't be so frightened of it and will actually see the benefit of a workforce which when they're happy and healthy work harder, stay longer, are more and actually do better work. So it's a win win, really."
Young campaigners, working with Save the Children, recently petitioned the assembly for a living wage above the minimum wage.
Iram Shahzad, a 13-year-old pupil at Fitzalan High School in Cardiff, told BBC Wales Sunday Politics that people in her community were working long hours but not earning enough money to cover their everyday essentials.
"It's not fair that they don't get to live a happy life," she said.
James Pritchard, head of Save the Children in Wales, said a living wage would be a "direct way of starting to tackle child poverty".
Sunday Politics is on BBC One Wales at 12:00 BST.
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