Flat dividend payout from banks weigh on Abu Dhabi stocks

Dubai:

The Abu Dhabi index fell on Wednesday dragged by banks, which paid almost flat dividend. Select buying was witnessed in Dubai.

The Abu Dhabi Securities Exchange general index closed 0.50 per cent lower at 4,526.26.

“We had the big banks that came out yesterday. The dividend is what people are looking at. But due to flat payout by banks, people instead looked at smaller cap stocks,” Sanyalaksna Manibhandu, director Research, National Bank of Abu Dhabi Securities said. National Bank of Abu Dhabi (NBAD) fell more than 5 per cent after the bank proposed to pay flat dividend of 0.45 fils per share, Abu Dhabi Commercial Bank (ADCB) cut dividend to 40 fils per share.

“NBAD did not increase its dividend, whereas ahead of the announcement there was a lot of expectations of they would do it, which was a disappointment,” Manibhandu said.

NBAD fell 5 per cent to close at Dh9.88, while ADCB closed 2.24 per cent lower at Dh6.98. First Gulf Bank rose 0.39 per cent to end at Dh13.

GFH re-test peak

Gulf Finance House (GFH) re-tested its previous 52 week high, contributing to 65 per cent of the total volumes.

GFH closed 1.47 per cent higher at Dh2.76, after hitting a high of Dh2.90, re-testing its previous 52 week high.

Amanat closed 4.35 per cent higher at Dh1.20, while DAMAC Properties closed more than 2.5 per cent higher at Dh2.78.

The Dubai Financial Market General Index closed 0.30 per cent higher at 3,653.65.

Analysts expect traders to buy dividend stocks intermittently.

“There will be a pause for 3 days, and people would buy big banks with dividends. The trend has more been sell of fact,” Manibhandu said, adding “the dividend story is applicable but there will be pauses before the end of the season.”

Elsewhere in the Gulf, the Tadawul index closed 0.01 per cent lower at 7,100.93. The Kuwait Stock Exchange index ended up 0.74 per cent higher at 6,847.96.

The valuations are quite rich on PE. If the country does not stand the test of macro matrix, people would sell them out,” Manibhandu said. The Qatar exchange index closed flat at 10,596.14.