Mixed results for UAE markets as DFM ends rally

Dubai: UAE markets are expected to close higher on the Dh73 billion bond announcement on Sunday, after closing on a mixed note with the Dubai Financial Market shedding 4.33 per cent, arresting its four-day rally and Abu Dhabi Securities Exchange (ADX) gaining 1.09 per cent.

The UAE markets lost Dh2.12 billion in market capitalisation yesterday as the total UAE market capitalisation slipped to Dh345.81 billion, according to the Emirates Securities Market.

The ADX index advanced for a third session, closing at 2,274.60. Real estate stock performance was more stable than their Dubai counterparts. Sorouh Real Estate gained 0.44 per cent to Dh2.28, while Aldar Properties saw no change and closed at Dh2.32.

Volumes are expected to be high on the ADX this week, it is expected to be modest on DFM. The cash will flow towards the capital in the coming sessions, according to Hesham Bakry, Institutional Sales Manager, Al Futtaim HC brokerage firm.

The DFM general index closed at 1,531.88, with the stock falling 9.86 per cent to Dh1.28. Real estate also saw major losses as Emaar fell by 9.57 per cent to Dh1.28, after its US subsidiary filed for bankruptcy on Thursday.

Union Properties and Arabtec shed 9.64 per cent to Dh0.75 and 9.57 per cent to Dh1.70 respectively.

Mathew Wakeman, managing director, cash and equity linked trading, EFG-Hermes said, "The fact that the recent rally has no news flow to support it meant this was still a speculative rally in a bear market."

Bakry said the decline on DFM yesterday was due to profit taking. Speaking on Emaar, he said that while the stock's fall was expected, some investors believe it to be positive news.

Wakeman said the DFM is at a crossroads. "We either get some justification or confirmation on recent rumours or we give last weeks gains back."