Damac, DIB bounce as Dubai index nears key resistance

Traders position themselves ahead of key second quarter banking results

Gulf News

Dubai:

Damac shares, which hit another record as traders resorted to further accumulation, along with Dubai Islamic Bank (DIB) helped the broader gauge to bounce further, nearing the critical resistance.

Damac hit another peak at Dh4.57, before closing 3.75 per cent higher at Dh4.43. Dubai Islamic Bank closed 0.86 per cent higher at Dh5.85.

“People are keen to trade in DIB ahead of results.

Traders are positioning themselves ahead of results only liquid stocks,” Sanyalaksna Manibhandu, Director-Research, National Bank of Abu Dhabi Securities said.

DIB and Emirates NBD will publish their second quarter results on Wednesday.

Property names like Damac, Emaar Properties, Arabtec also witnessed buying.

“People are expecting good results in Damac results. People are buying Emaar on hopes of more clarity from the company on the real estate unit,” he added.

Profit-taking

“The more stocks go up before the results, the deeper the profit taking would afterwards. If the earnings come out with solid outlook. There will be profit taking, but people will buy back,” Manibhandu said.

Analysts expect lower provisioning in the second quarter because of tighter lending requirements in the last three quarters even as they expect a flat operating profit due to cautious approach to lending.

In the broader market, the Dubai index closed 0.82 per cent higher at 3,602.46, after hitting a high of 3,609.09, nearing the critical resistance of 3,738, a level last seen in January 15. The index slumped 14 per cent to touch a low of 3,264.36.

FAB, Etilasat shares saw buying in Abu Dhabi Securities Exchange.

The Abu Dhabi Securities Exchange general index closed 1.14 per cent higher at 4,575.61.

Etisalat closed 0.82 per cent higher at Dh18.35, while First Abu Dhabi Bank closed 2.84 per cent higher at Dh10.85.

Elsewhere in the Gulf, Saudi Arabia’s Tadawul index closed 0.77 per cent lower at 7,291.93. The Qatar exchange index closed 1 per cent higher at 9,436.08.

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