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UAE Stocks Slightly Higher after Holidays

The Dubai Financial Market benchmark index ended just 0.63 per cent higher to 1,987.26, little changed from its finish on November 30 before the markets shut down from December 1 to 10. Volumes were thin at just Dh294.154 million.

The Abu Dhabi Securities Exchange main index gave up early gains, inching up 0.09 per cent to 2,756.93.

“UAE volume, both in Dubai and Abu Dhabi, failed to cross $100 million, therefore the buying this morning was not very convincing, and it did not take too much selling to knock the stocks back down,” said Ali Khan, executive director of Arqaam Capital.

“Even as stocks were generally higher in other markets when the markets here were closed, investors were hesitant and were waiting for a bigger catalyst,” said Vyas Jayabhanu of Al Dhafra Financial Brokerage.

Investors seemed unimpressed with Arabtec Holding PJSC , the country’s largest construction company after it said it had more than Dh43 billion in order book to cushion the impact of a downturn in Dubai property sector.

The stock fell 3.71 per cent to Dh4.40.

Arabtec which operates in the UAE, Qatar, Jordan, Syria and Pakistan, also doused talks it planned to cut its 52,000-workforce, but admitted in an interview with Bloomberg that some future projects may be rescheduled because of expected further slump in the property sector.

“I think the market is not forgetting that the stock rallied over 50 per cent in just four days before the holiday break. The stock needs to consolidate over the short-term before any smart money returns to the stock – despite guidance from CFO about Dh43 billion order book,” said Khan.

Emaar Properties, the region’s biggest property developer stemmed more selling spree, gaining 3.69 per cent to Dh3.09. Emirates Integrated Telecommunications PJSC or du, climbed 6.15 per cent to Dh2.93.

“We expect that du will continue growing its market share of active mobile subscribers to around 28 per cent by end 2009 from 24 per cent a end 2008 and maintain the highest share of net additions, at 65 per cent,” said EFG-Hermes in its UAE Yearbook 2009.

Abu Dhabi-listed and dominant telecommunications company Etisalat rose 1.63 per cent to Dh12.30.

“We expect that the two operators, will maintain roughly equal shares of subscriber net additions, while Etisalat will keep around two-thirds of the mobile market, or a market share of around 67 per cent given its better-entrenched position and strong distributional power in the UAE,” said EFG Hermes.

rocel@khaleejtimes.com