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UAE markets recover Dh41b
The UAE government's decision on Sunday to support the banking system helped the markets recover some Dh41 billion on Monday.
- By Ahmed A. Elewa, Senior Reporter
- Published: 23:28 October 13, 2008
- Investors at the Dubai Financial Market watch price movements. The sentiment among traders and investors was cautiously optimistic on the back of the UAE government's announcement that it would guarentee deposits in national banks.
- Image Credit: Megan Hirons/Gulf News
Abu Dhabi: The UAE government's decision on Sunday to support the banking system helped the markets recover some Dh41 billion on Monday.
All leading shares made substantial gains, especially in the banking and real estate sectors where the heaviest losses had been incurred.
The Emirates Securities general index soared 7.82 per cent to 3,984.66, its highest single-day gain since January 2008, while investors are looking to recover from the losses that dragged down the value of listed companies from its peak of Dh883 billion in June 2008 by about Dh300 billion.
"The government's package resulted in restoring confidence among banks and depositors, which was extremely important for the markets to rebound at this stage," said Rami Sidani, an associate partner with Shuaa Capital.
"An additional element is the recovery of international markets on account of the European financial salvage package," he added.
In Dubai the general index shot up 10.53 per cent to 3,343.56 reflecting the strong gains recorded by the leading shares.
No offerings
"All the leading shares were trading at the maximum limit-up towards the end of the session with no offerings on the screen, a very healthy sign indeed," Sidani said.
Emaar Properties recovered 15 per cent of its value to close at Dh5.90 on heavy trading worth Dh631 million, followed by other leading real estate developers and contractors such as Arabtec, which recorded maximum gains as well to close at Dh7.97, and Union Properties, which surged 14.66 per cent to Dh2.19.
Most of the listed banks and financial institutions stood at price levels close to maximum gains including Dubai Islamic Bank, Amlak Finance, and Tamweel. The only exception was Emirates NBD, which recorded a modest gain of 2 per cent to close at Dh7.70. Foreigners will "continue to play a tangible role given that the positions they have sold are short-positions, hence inflows and outflows of foreign funds will continue on that basis", Sidani explained.
The general index of Abu Dhabi Securities Exchange shot up by almost 7 per cent to close at 3350.22, where a similar pattern of strong gains by the banking and real estate sectors prevailed.
The banking sector recovered more than 6 per cent, as the leading banks reported gains close to the maximum limit, especially the National Bank of Abu Dhabi, which surged 9.80 per cent to Dh11.20 and Abu Dhabi Commercial Bank, which shot-up 9.43 per cent to Dh2.91.
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