MIDEAST STOCKS-Qatar falls as diplomatic deadline looms, Saudi rally stalls – Reuters

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Qatar’s stock market dropped in
early trade on Sunday as a deadline for Doha to accept a series
of political demands by four Arab states was expected to expire
late in the day with no sign of the crisis ending.

Qatari Foreign Minister Sheikh Mohammed bin Abdulrahman
al-Thani said at the weekend that the demands were made to be
rejected. He insisted Qatar would not close a Turkish military
base or shut Doha-based satellite channel Al
Jazeera.

The four Arab states have warned they may impose further
sanctions if Qatar does not comply; they did not give details,
but bankers believe, for example, that Saudi, United Arab
Emirates and Bahrain banks might receive official guidance to
pull deposits from Qatar.

Doha’s stock index was down 2.0 percent after 45
minutes of trade as all 18 companies with a value above $1
billion dropped. Constituents of the MSCI emerging market index
were some of the worst performers, with Vodafone Qatar
down 4.1 percent.

On June 22, the last day on which the market traded
before closing for a week-long Eid al-Fitr holiday, foreign
funds were net buyers of Qatari shares for the first time since
the crisis erupted on June 5.

Saudi Arabia’s index was nearly flat early on Sunday
as it reopened after Eid. It had risen sharply between June 20
and 22 on news that international index compiler MSCI had placed
Riyadh on a watch list for upgrade to emerging market status and
that the architect of Saudi economic reforms, Prince Mohammed
bin Salman, was named crown prince.

Some of the recent top performers fell because of profit-
taking on Sunday, with property developer Emaar the Economic
City dropping 2.4 percent.

Medical insurer BUPA Arabia rose 1.5 percent after
the company said it had renewed its insurance contract with
blue-chip petrochemical producer Saudi Basic Industries
. BUPA expects the contract to have a positive impact
on 2017 net earnings, but it did not give a monetary value.

Dubai’s index was down 0.3 percent, hit by a 1.2
percent decline in Dubai Islamic Bank. In neighbouring
Abu Dhabi the index was also dragged lower by banking
shares; Union National Bank was down 1.1 percent.
(Reporting by Celine Aswad; Editing by Andrew Torchia and Dale
Hudson)