* Egypt corporates not due to issue Q1 results till May
* Gulf companies kick of Q1 earnings season
By Patrick Werr
CAIRO, April 6 (Reuters) - Egyptian share prices will recover only slowly in the next few weeks from the country's political turmoil, with many investors sticking to the sidelines until first quarter results give them a glimpse of how bad the damage was.
The results season won't begin in earnest until mid-May, but analysts believe the turmoil, which ravaged the country's tourist industry and briefly paralysed many businesses, including banks, bit deeply into revenues and profit.
Analysts said that after a market bounce last week, investors are now stepping back and taking a longer-term view.
"The first week we had really high volumes and really high volatility. It will become a bit more subdued in the next few weeks," a Cairo-based equities strategist said.
Egypt's benchmark index plunged for two days when the stock exchange reopened on March 23 after a suspension of almost eight weeks, but rebounded by more than 10 percent the following week.
"The fundamentals in the long term are strong, the strategist said. "But on the other hand, if your growth is going to be slow, and we think the economy's going to contract. If you look at companies that are pure Egypt exposures it's going to be a difficult year for them."
Orascom Construction Industries is the main stock believed to be resistant to an earnings decline, boosted by a jump in fertiliser prices.
Traders say domestic investors, including private banks, have been returning to Egypt's treasury bill market after the central bank on March 22 introduced repurchase agreements on the money market that made its bills more liquid, and as a results, yields are expected to continue falling gradually.
Foreign investors remain absent from the market, however, and those who were in the market have not been rolling their bills over as they mature and are not expected to re-enter the market anytime soon.
Currency dealers expect the Egyptian pound, whose float against the dollar is closely managed by the central bank, to maintain its slow weakening against the dollar. The pound has lost about 2.5 percent of its value against the dollar since Egypt's unrest erupted on Jan. 25.
GULF RESULTS SEASON BEGINS
In the Gulf, the first-quarter results season kicked off this week in Qatar and Saudi Arabia, with lacklustre earnings from Saudi dairy producer Almarai dampening sentiment before upbeat figures from Methanol Chemicals Co (Chemanol) provided some support. Petrochemicals stocks are seen prospering as high oil prices boost producers' margins.
Qatar National Bank reported a 34 percent rise in quarterly earnings on Wednesday, boosted by strong loan growth, and lenders' results will be the barometer for Gulf Arab markets, said Robert McKinnon, ASAS Capital chief investment officer.
"The key is going to be banks -- if we see provisions are tapering off, that will provide comfort to the market," said McKinnon.
"Regionally, banking is the largest sector. If they are nearing the end of the provisioning cycle, this will eventually pass through to the rest of the economy. UAE bank stocks are cheap -- there could be positive surprises."
Civil unrest has rocked the autocratic Gulf Arab region this year. Deadly demonstrations erupted in Oman, while Saudi Arabia sent troops to Bahrain to put down protests by the Island's Shi'ite majority against the Sunni monarchy.
Only Qatar and the UAE were entirely unscathed and these troubles prompted some traders to champion Dubai and Abu Dhabi markets as potential safe havens.
Yet this argument is flawed, said ASAS's McKinnon, with turnover on UAE markets failing to increase significantly.
"If you wanted to pull your money out of Saudi Arabia, then the case for putting it into Dubai stocks is rather thin -- you would go for the perceived safety of developed markets," he said.
Dubai's index remains down 75 percent from a 2008 peak as a savage real estate correction sent stocks tumbling on the property-dominated bourse.
"I don't think anyone is expecting anything special from real estate in Q1," added McKinnon.
"The Dubai market could make a long-term recovery, but it would be driven by banks and telecoms, not real estate."
Saudi Arabia developers are more bullish, with the kingdom's mega state spending plans, which include building an extra 500,000 homes, seen as a long-term catalyst for earnings growth.
Dar Al Arkan has eased slightly this month after gaining 11 percent in March, while Saudi Arabia's real estate index rose 6.6 percent over the same period.
"Arkan is due for profit taking -- it's not likely to see further gains (for now)," said Hesham Tuffaha, Bakheet Investment Group's head of asset management.
"We want to see a sign of growth in the real estate companies before we take further long-positions on those companies." (Additional reporting by Matt Smith and Nadia Saleem in Dubai; Editing by Jon Loades-Carter)