Abu Dhabi shares lead regional gains after merger nod

Dubai: Abu Dhabi stocks led regional gains on Sunday after the boards of FGB and National Bank of Abu Dhabi (NBAD) approved the merger of the two lenders, triggering a fresh round of buying in banking stocks, while cherry-picking of stocks was witnessed in Dubai.

The Abu Dhabi Securities Exchange General Index closed the day’s session 1.15 per cent higher at 4,549.42, after touching a high of 4,579.29, a level last seen in April. NBAD and FGB shares cornered trading on the bourse, contributing to 71 per cent of traded volumes.

“Overall, the catalyst was the banking sector in Abu Dhabi,” Talal Touqan, Head of Research and Advisory at Al Ramz Capital, told Gulf News. “The disclosure by FGB and NBAD sparked a speculative trade over other banks on speculation over [a] potential consolidation in banking sector.”

The boards of both banks approved the merger which is set to take place in the first quarter of 2017, thus creating an entity with Dh642 billion in total assets.

NBAD shares ended 4.04 per cent higher at Dh10.05, while FGB ended 1.98 per cent higher at Dh12.85. Other banks like Union National Bank (UNB), Abu Dhabi Commercial Bank (ADCB) and Sharjah Islamic Bank also jumped.

UNB ended 5.85 per cent higher at Dh4.34, while ADCB ended 3.8 per cent higher at Dh6.28. SIB ended 3 per cent higher at Dh1.56.

Methaq Takaful Insurance Co ended more than 5 per cent higher.

Out of a total of 23 stocks traded on the exchange, the shares of 12 companies advanced while those of three companies retreated.

Cherry-picking on DFM

Trade volumes in Dubai — at Dh216 million — were higher than the Dh146 million witnessed in Abu Dhabi on Sunday. Traded values in Dubai stood at Dh280 million last week.

While the activity was focused on the banking sector in Abu Dhabi, some cherry-picking in stocks also happened in Dubai. Touqan said people are expecting a technical rally before Eid — which he said spurred traders to build up positions ahead of the holidays.

The Dubai Financial Market General Index closed 0.78 per cent higher at 3,336.88.

Dubai Islamic Bank, which was the top traded stock on bourse, ended 2.54 per cent higher at Dh5.24, while Dubai Parks ended 0.64 per cent higher at Dh1.57.

Arabtec ended more than 2 per cent higher at Dh1.39, while Emaar Properties ended close to a per cent higher at Dh6.25.

Out of a total of 36 stocks traded on the bourse, the shares of 27 companies advanced while those of seven retreated.

Elsewhere in the Gulf, the Qatar Exchange index closed 0.40 per cent higher at 9,924.47 while the Muscat Securities MSM 30 index closed 0.61 per cent higher at 5,812.32.

Kuwait’s stock exchange index closed 0.08 per cent higher at 5,369.03 while Bahrain’s index closed 1.13 per cent higher at 1,131.04.

In the wider Middle East, the Egyptian EGX 30 index closed 0.56 per cent higher at 6,981.72.

Saudi Arabia’s market was closed with markets in Oman, Kuwait and UAE expected to be closed from Tuesday through Thursday.