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UAE Shares Decline on Profit-taking

DUBAI — United Arab Emirates stocks on Thursday declined on profit-taking. Mashreq Bank in Dubai and Union Cement Co. in Abu Dhabi led the downward slide.

The benchmark index of the Dubai Financial Market gave up some of its gains from Wednesday, ending 1.67 per cent lower at 1,516.53. The index lost 2.7 per cent overall from the previous week. Retail investors dominated trading, which finished the day in Dubai with a total value of Dh740.653 million. The main index of the Abu Dhabi Securities Exchange inched down by 0.25 per cent to 2,417.68 but gained 1.7 per cent overall from a week ago. “With the long week-end ahead, investors are squaring their positions especially after yesterday’s strong rebound,” said Sherif Abdul Khalek of Beltone Financial Securities.

The banking sector weighed down the Dubai Financial Market index. Mashreq Bank, the UAE’s biggest private bank, fell 5.00 per cent to Dh193.45. Commercial Bank of Dubai slipped 4.87 per cent to Dh3.90, while the Dubai Islamic Bank was down 2.11 per cent to Dh2.31.

Emirates NBD, the country’s largest bank by assets, closed flat at Dh3.13. The bank said it is raising Dh6.3 billion by converting federal deposits into capital to boost its capital base and cushion itself better during the financial crisis.

“That would put the bank in a very good position. It would improve its capital adequacy ratio,” said Hesham Bakry, institutional sales manager at Al-Futtaim HC Securities. Bakry’s firm recently initiated coverage of Emirates NBD with a ‘buy’ rating and a target price of Dh6.30.“Emirates NBD is well-positioned to withstand the crisis, but it needs sovereign support to improve liquidity and capital base,” Al-Futtaim said in its research note.Property stocks also dropped, led by index heavyweight Emaar Properties, which shed 0.49 per cent to Dh2.02. Emaar, the biggest property company in the Middle East, said on Thursday in an e-mailed statement that it might consider shelving or postponing projects after receiving petitions for it to halt projects amid the property sector downturn. Arabtec Holding, the No. 1 construction company in the country, declined 1.93 per cent. Construction-related stocks led decliners in Abu Dhabi, with Union Cement Co. plunging 9.78 per cent to Dh2.03. Arkan Building Materials lost 6.89 per cent to end at Dh5.63.

rocel@khaleejtimes.com