Dubai: The Dubai index ended lower again on Wednesday led by Emaar Properties and Arabtec amid falling crude oil prices. The Abu Dhabi Index also ended a tad lower.

The Dubai Financial Market General Index ended 0.88 per cent lower to be at 4,551.49, after gaining 1.43 per cent in the previous session.

“It showed weakness due to international market volatility. Local investors are reducing their risk exposure,” Marwan Shurrab, fund manager and head of trading at Vision Investments & Holdings.

“The outlook is conservative due to downside in commodity prices,” he said.

West Texas Intermediate crude dropped for a third day as U.S. oil inventories gained unexpectedly. In Europe, stocks hovered near a seven-week high as investors awaited the release of minutes from the Federal Reserve policy meeting.

The benchmark index climbed 1.1 per cent in the past two days as German investor confidence rose and Mario Draghi said the European Central Bank’s expanded purchase program could include government bonds.

Back home, Emaar Properties, the most-active stock in terms of value, ended 0.46 per cent lower at Dh10.90. Arabtec ended 2.22 per cent lower at Dh3.96.

On the broader Dubai index, out of a total of 29 shares traded on the exchange, shares of 21 companies declined, while shares of 4 companies rose.

In Abu Dhabi, the ADX general index ended 0.11 per cent lower at 4,936.18. Out of a total of 31 companies, shares of 11 companies rose, while 17 of them declined and the other 3 remained steady.

Year-end profit taking:

“We are at fair levels. We are heading towards year end and we won’t be surprised if investors take the opportunity to lock in some profits,” said Saleem Khokhar, head of equities at NBAD’s asset management group. “We expect nervousness going forward with continued volatility.”

The Dubai index has gained 38 per cent so far in the year, making it the best performer in the Gulf region.

“We like the defensive sectors. We are bullish on utilities and banking sector in Dubai. We are also bullish on banking sector due to expectations of strong dividend distribution in 2014,” Shurrab added.

The banking sector in the UAE has reported an eight per cent loan growth for the first nine months of this year and bank lending remains within prudential ratios set by the central bank, said Saeed Abdullah Al Hamiz, Assistant Governor for Banking Supervision at the UAE Central Bank on November 17.

The UAE banking sector, the largest in the region posted an asset growth of 10 per cent for the first nine months of this year to Dh2.31 trillion. Banking sector assets increased by an annual average of about 6 per cent during 2010-2013.