Dubai: The UAE’s main bourse indices continued to trade within narrow ranges, moving sideways on Sunday amid a lack of catalysts to spur buying or selling activity.
The Dubai Financial Market (DFM) index inched up 0.17 per cent to close at 2,885.35 as trade values dwindled to Dh186 million even as corporate earnings season kicked off.
The index has been below the psychological 3,000 level for over three weeks ever since private equity group Abraaj filed for provisional liquidation, raising concerns about other companies’ exposure to it.
Shiv Prakash, senior research analyst at First Abu Dhabi Bank Securities, said the DFM index is expected to head higher over the next few trading sessions towards its next resistance level of 2,935.
“The index may test this resistance level and come back down, so there should be some profit-taking at 2,935. When it tests that level, it shouldn’t then breach the 2,800 level because that could then take the index to 2,665,” he said.
“The stocks to focus on are Dubai Islamic Bank and Emaar, which may help the DFM index reach that 2,935 area.”
Dubai Islamic Bank on Sunday gained 1 per cent, as GFH Finance House rose 3.5 per cent, and Union Properties ended 0.42 per cent higher. Meanwhile, Gulf Navigation, the most actively traded stock on DFM, fell 2.65 per cent as Drake and Scull International slid 0.31 per cent. Summer holidays
Prakash said GFH, which was the second biggest gainer on Sunday, is poised to break above the Dh1.5 level after it ended at Dh1.48, with the stock’s price likely to extend the move towards Dh1.78 in the coming weeks.
As for Dubai’s main index, the sideways trading comes as many investors head out of the country for summer holidays and after the index has already shed around 14.4 per cent year-to-date, making it one of the worst performing indices in the region.
The Abu Dhabi Securities Exchange (ADX) index by comparison is up around 4.7 per cent year-to-date while Saudi Arabia’s main index is over 13 per cent higher year-to-date. The ADX general index ended 0.27 per cent higher on Sunday at 4,615.46.