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UAE Shares Decline

The Dubai Financial Market Index dropped more than 4 per cent in mid-session as property stocks tanked, but late-trade buying trimmed losses to 2.39 per cent at 1,728.95. Despite strong gains petering out during the week, Dubai stocks still closed the week with gains of 5.78 per cent.

The Abu Dhabi Securities Exchange’s gauge, shed half a per cent two days in a row to to 2,527.41, but still had a net gain of 5.8 per cent for the week.

“The end of week position closing weighed heavily on the market today in Dubai whereas Abu Dhabi is seeing continued speculative buying across the large cap real estate names ahead of full year results,” said Matthew Wakeman, managing director of cash and equity linked trading at EFG-Hermes Dubai.

Property issues in Dubai fell 6.79 per cent led by index heavyweight Emaar Properties.

The Middle East’s biggest property company skidded 7.27 per cent to Dh2.42. Union Properties followed suit, dropping 6.09 per cent to Dh0.77 while Deyaar Development gave up 5.35 per cent to Dh0.53.

Arabtec Holding, the country’s largest construction company which is building the world’s tallest tower, the Burj Dubai, fell for a third straight day to 5.99 per cent to Dh2.04.

Adding to the markets’ weakness were several negative overseas leads, including a weaker-than-expected jobs report in the US, dour profit forecasts by big companies in the world’s biggest economy, while oil prices fell to its lowest in seven years on rising US inventory, indicating demand remains tepid.

Crude oil for February delivery on Thursday rose 2 per cent to $43.48 a barrel at the New York Mercantile Exchange, rebounding from its worst slump in seven years when it slipped on Wednesday to $42.63 a barrel.

“I actually expected the selloff today to be bigger because of negative news overseas, but it didn’t happen,” said Chamel Sahmy of Beltone Financial Securities.

“That proves that optimism is gradually building up, and hopefully we have hit the bottom.”

Banks weighed in Abu Dhabi. The National Bank of Ras Al Khaimah lost 9.87 per cent to Dh4.75, the Union National Bank slipped 5.93 per cent to Dh2.38, while the National Bank of Abu Dhabi dropped 4.18 per cent to Dh9.63.

Looking forward, UAE bourses next week will start focusing on company earnings.

“The fourth quarter corporate results will be the major catalysts. The negative factors have all been priced in, there’s not much that investors have not seen,” Ali Khan, executive director of Arqaam Capital, said.

rocel@khaleejtimes.com