Dubai: Trade values dwindled on the UAE’s stock markets, with the main indices ending nearly flat on Wednesday amid a lack of catalysts to drive any strong trading activity.
The Dubai Financial Market (DFM) General Index closed at 2,740.68, down 0.08 per cent, just a few days after it breached its critical 2,800 support level, which signalled further downside for the index.
Trade concentrated on small and mid-cap companies, rather than blue chips, including Union Properties, Salama, and GFH Financial Group, which all ended in the red. Union Properties slid 0.44 per cent, as Salama fell 5.55 per cent, and GFH shed 2.19 per cent.
Technical analyst Osama Al Ashry said trading activity on the DFM was weak, with no positive news to support buying activity. He pointed out that heavyweight Emaar is also trading near its lowest level as investors are not optimistic on its dividend distribution plans.
“There is no risk appetite in the market, and the slump on the DFM has lasted longer than usual. I don’t really see any indicators that the market will rebound soon,” he said.
Al Ashry said that the next support level for the index is at 2,580.
“The question is whether the index will continue dropping to its next support level or whether it will rebound. I don’t think it can rebound. If at the end of this month, it closes near its current level, we’ll definitely see a new low,” he said.
The DFM index is now down 18.68 per cent year-to-date, with other analysts saying the trend remains bearish despite many stocks having attractive valuations.
On Wednesday, the Abu Dhabi Securities (ADX) General Index was also little changed, inching up 0.16 per cent to close at 4,884.06.
Powerhouses First Abu Dhabi Bank, Aldar Properties, and etisalat were the most actively traded stocks on the bourse, though their share prices did not move much in either direction as trade values remained weak. FAB inched up 0.14 per cent, as Aldar slid 0.56 per cent, and etisalat ended flat.
“The resistance level at 5,000 acted strong, attracting mild profit-taking... Only a close over [this] resistance shall extend the bullish move,” said an analyst note from First Abu Dhabi Bank Securities.