Dubai
Fresh buying emerged in shares of First Abu Dhabi Bank, trading under the NBAD symbol after the merger between First Gulf Bank and National Bank of Abu Dhabi, on expectation of a higher weightage on the MSCI emerging index, triggering a rally in Abu Dhabi stocks.
The Abu Dhabi index extended gains for another session, jumping 1.8 per cent, leading regional gains to their highest level in nearly a month.
Shares in the merged bank closed up 4.81 per cent at Dh10.90, after hitting a 52-week high of Dh11, and was the biggest gainer in trade. About 8.13 million shares were traded, contributing to 8 per cent of the total volume of 90 million shares.
“Investors are buying in the new entity [First Abu Dhabi Bank] ahead of rebalancing in the FTSE and the MSCI. That will support passive inflows and interest to benefit from the increase in the rating,” said Marwan Shurrab, head of high net worth and retail equity brokerage, Al Ramz.
“As the merger goes on, we would see fruits from the merger, which would benefit the bank and shareholders,” Shurrab said.
The merged entity is yet to change the ticker on the Abu Dhabi Securities Exchange.
Focus was also on Aldar and Etisalat in Abu Dhabi. Aldar Properties fell 0.44 per cent lower at Dh2.28, while Etisalat closed 0.28 per cent higher at Dh18.
About 50 per cent of the turnover was in Aldar and First Abu Dhabi Bank, but overall liquidity remained low. “We have low liquidity going into April. Expectations are that this liquidity would trickle down in coming weeks and months. First quarter numbers would be key to deciding the price movement and liquidity,” said Shurrab.
In Dubai, the index closed higher, extending gains for another session. The Dubai Financial Market General Index closed 0.58 per cent higher at 3,559.69.
“The trend is turning positive but a close over the 50 Day SMA is required for it to gain further strength and target the 3670 barrier. Traders may look to remain stock specific and buy only the fresh bullish breakouts,” said Shiv Prakash, senior analyst with National Bank of Abu Dhabi Securities, said in a note.
Dubai Islamic Bank closed more than 1.5 per cent higher at Dh5.76. Arabtec closed 0.32 per cent higher at Dh0.940 as the stock witnessed renewed interest.
Gulf Finance House closed 0.82 per cent lower at Dh2.45. DXB Entertainments closed 0.9 per cent lower at Dh1.04. Traded value was at Dh338 million, compared to Dh200 million last week.
Elsewhere in the Gulf, the Saudi Tadawul index closed 0.326 per cent higher at 6,986.19.
The parallel index Nomu closed 0.47 per cent lower at 5,009.17. The Qatar exchange index closed 0.46 per cent higher at 10,391.70.