Dubai: Dubai index lead losses in the Gulf as weaker-than-expected results from the banks weighed on sentiment.
The Dubai Financial Market General index fell 1.28 per cent to end at 3,447.26, while the Abu Dhabi Securities Exchange General index ended 0.82 per cent lower at 4,506.14.
“What we were witnessing for smaller banks, the larger banks are getting impacted as far provisions and slowdown is concerned, and that was also providing negative sentiment in markets,” Muhammad Shabbir, head of equity funds & portfolios at Rasmala, said.
Most banks in the UAE reported a decline in their first quarter profits with a few notable exceptions such as Emirates NBD, Dubai Islamic Bank (DIB) and Abu Dhabi Islamic Bank (ADIB) that managed to record profit growth along with improvements in asset quality indicators.
In stock specific action, Arabtec ended more than 3 per cent lower at Dh1.58, while Emaar Properties ended more than 2 per cent lower at Dh6.64. Gulf Finance House ended more than a per cent lower at Dh0.890.
Arabtec may hit a new low of Dh1.51 later this week, said Osama Al Ashri, member of British organisation, Society of Technical Analysts, adding Gulf Navigation may hit a new high of Dh1.19. Emaar may consolidate in the range of Dh6.15-6.80, said Al Ashri, adding Gulf Finance House may breach the Dh1 mark later this month.
DIB may breach support level of Dh5.55 later this week, said Al Ashri, adding Damac Properties may breach support level of Dh2.47 during this week.
DIB ended 0.85 per cent lower at Dh5.81. Damac Properties closed 0.78 per cent lower at Dh2.56. Out of a total of 34 stocks traded on the exchange, shares of 24 firms fell, while seven other firms rose.
In Abu Dhabi, Abu Dhabi Islamic Bank fell 1.48 per cent lower to end at Dh3.99. Taqa ended more than 3 per cent lower at Dh0.61. Aldar Properties ended more than 1 per cent to be at Dh2.69.
Eshraq Properties may not breach support level of Dh0.80 and may recover to hit a new of Dh0.93 by next week, said Al Ashri. Bank of Sharjah may support level of Dh1.25 during this month, Al Ashri said, adding Aldar Properties may hit support level of Dh2.59 again. Out of 25 stocks traded on the bourse, shares of 17 firms fell, while other 4 rose, the rest of them remained steady.
Going ahead, “market would remain sideways with a negative tone due to results, and globally markets are running out of steam,” Shabbir said. Investors would also look at first quarter results from property companies and also guidance for the remainder of the year.
In the rest of the Gulf, Muscat securities MSM 30 index ended 0.09 per cent higher at 5,948.07, while Kuwait Stock Exchange index closed 0.22 per cent higher at 5,403.43. Saudi’s Tadawul index ended 0.76 per cent lower at 6,754.3, after losing 2.28 per cent in the year so far.
“Compared to other markets, Saudi and Qatar indices are the only one in red. If something concrete comes out of this 2030 plan we would see some improvement,” Shabbir said. Saudi’s Tadawul index may see an upside of 10-12 per cent in the next 6 months, Shabbir added.
Maaden may hit a new high during this week to resistance level of 43.75 Saudi Riyals, Al Ashri said, adding Saudi Basic Industries may hit a new high to hit 87.75 Saudi Riyals during this week. Qatar index, which ended almost flat at 10,187.98, may hit a new low of 9,781 by the end of this month, Al Ashri said.