Abu Dhabi and Dubai stocks extended their gains from Sunday, with blue-chips leading the advances with the earnings season in full swing.
Abu Dhabi Securities Exchange picked up 0.3 per cent to 6,092 points in early Monday trades, with Abu Dhabi Islamic Bank the biggest gainer with 1.5 per cent after first-quarter profits more than doubled to Dh608 million. The improved bottom-line was realised on the back of a combination of factors.
Factors driving bottom-line
Revenues expanded reflecting a rebound in UAE economic activity. Operating expenses, on the other hand, dropped around 7 per cent due to successful implementation of initiatives and as the efficacy of its digital strategy helped improve productivity. What also contributed to the bottom-line was a whopping 65.5 per cent drop in net impairment charges to around Dh134 million from Dh387 million a year ago.
The 125 per cent jump in first-quarter profit figures marks a stark reversal from the fourth quarter, when profits plunged 36 per cent as the economy and business were scrambling out of the pandemic impact.
Earnings play a role
RAK Properties chiselled out a 0.9 per cent gain after posting a more than five-fold spike in first-quarter profits to Dh64 million. Revenues also scaled up 244 per cent, signalling a rebound in the property market, and the firm's outlook appeared bright with Dh152 million recorded in sales backlog.
Dubai Financial Market ticked up 0.5 per cent to 2,637 points, bolstered by the real estate stocks with Emaar Properties, Emaar Development and Damac advancing, receiving a tailwind from upbeat sector results. Dubai Investments added to its gains after swinging into first-quarter profits. The stock market operator Dubai Financial Market also ticked up around 2 per cent ahead of results announcement later in the day.