Democracy transition should be within a year and a half, says General Zaman
“Activity was again dominated by retail players, there was a lot of portfolio reallocation as it is the end of the year, that put pressure on the markets with investors wanting to close positions,” said Matthew Wakeman of EFG-Hermes in Dubai.
Attempts by the Organisation of Petroleum Exporting Countries to boost prices by reducing output was thwarted anew with crude oil prices sliding back to below $40 a barrel Tuesday at the New York Mercantile Exchange, already losing 59 per cent of its value this year when it peaked at $147.27 on July 11.
Weak oil prices raises more concerns about the health of the UAE economy, particularly liquidity shortages that have curbed robust activity in the property and banking sectors. “The liquidity crunch is affecting investor enthusiasm. Investors are being cautious and holding on to their money,” said Vyas Jayabhanu of Al Dhafra Financial Brokerage.
While oil prices are a factor, investors are shying away from the markets until the fourth quarter corporate results are out, said Faisal Hasan, research head of the Kuwait-based Global Investment House.
“Investors are more anxious to see the corporate profitability for 2008 and this will dictate the short term direction of the markets.”
“Company balance sheets for the last quarter of 2008 and the first half of 2009 will be important. This will give investors a better picture, and hopefully, investor confidence will be reinstated,” added Jayabhanu of Al Dhafra.
Property shares again paced decliners with
UAE’s largest construction company Arabtec Holding, edged down 9.9 per cent to Dh 3.81. Emaar competitior Union Properties shed 3.4 per cent to Dh0.84.
Dubai Islamic Bank dropped 5.7 per cent to Dh 1.82, while Shuaa Capital, the country’s biggest investment bank, lost 4.8 per cent to Dh0.98.
Shuaa said it will stop trading its shares at the Kuwait Stock Exchange starting on January 1 but will continue trading at the Dubai Financial Market.
Banking stocks in
Among property concerns, Aldar Properties fell 6.4 per cent to Dh 3.95, while Sorouh Real Estate gave up 4.2 per cent to Dh2.80.
“The steep slides in the markets may subside tomorrow as most issues are already trading below value,” said Jayabhanu.
Meanwhile, the UAE stock markets will be closed on December 28 and January 1 to mark the Islamic New Year and the New Year holidays, the market’s regulator said in a statement.
Democracy transition should be within a year and a half, says General Zaman
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