DUBAI: Saudi group Savola climbed to its highest level in nearly 8 months on Tuesday after saying it old a property firm for $168 million, while most Gulf markets declined. Savola rose 2.9 percent to its highest close since May 9. It sold its 80-percent stake in Al-Mujamaat United Co for Real Estate to Knowledge Economic City. Savola also confirmed a report that it would buy the remaining 22 percent stake in pasta makers Al-Malika and Al-Farasha in Egypt. Saudi Arabia's index closed 0.2 percent lower, slipping from Monday's 21-week closing high. Construction stocks were mixed as investors booked recent gains in stocks which rallied ahead of the 2012 budget announcement. Saudi Steel Pipes fell 6.4 percent, down from Monday's seven-month high. The government plans to spend 690 billion riyals ($184 billion) according to its 2012 budget. The finance ministry said it had set aside 250 billion riyals from the 2011 budget surplus to fund the construction of 500,000 homes. "Speculation on building, construction and real estate stocks will continue for the next two to three weeks, but the budget will have minimal effect on companies' profits currently," said Hesham Abo-Jamee at Bakheet Investment Group. "Most of the projects will go to companies that are not listed on the exchange like Binladin and Mabani." Yanbu Cement rose 4.2 percent to a fresh all-time high. On Monday it reported restarting three of four production lines which had been closed for two months. In Dubai, the index slumped 0.8 percent to a fresh seven-year closing low, hit by as a year-end trading lull. "Valuations-wise, the market is attractive but the problem is that there is virtually no investor interest," said Shakeel Sarwar at Securities & Investment Co (SICO). "Until big institutional investors take the lead, I don't think the market will recover in the short-term. Volumes have fallen, brokerages are shutting down, and it's a sorry tale. There seems to be no investors willing to come in and commit long-term capital." Drake & Scull shed 2.1 percent, while Union Properties dropped 5.6 percent. Shuaa Capital slid 6.9 percent, down 60 percent this year, in what traders called a falling-knife effect. The struggling investment bank said earlier in December it will lay off 29 of its employees in the first phase of a planned redundancy plan to boost profitability. Abu Dhabi's Aldar Properties fell 2.4 percent to a fresh record closing low. The developer said the portion of its bonds converted into 1.2 billion shares last week by Mubadala Development Co will be listed on Jan. 2. Mubadala converted AED 2.106 billion ($573 million) of bonds into shares at a price of 1.75 dirhams on Dec 15. In Qatar, bluechips helped lift the index 0.2 percent, approaching Sunday's 37-week closing high. Qatar National Bank added 0.5 percent, Barwa Real Estate climbed 0.8 percent and Commercial Bank of Qatar advanced 0.2 percent.
