UAE stocks snap three-day gaining streak

Dubai: UAE stocks ended down, snapping a three-day gaining streak led by property majors, as falling crude oil weighed on sentiment.

The Dubai Financial Market General Index ended 0.68 per cent lower at 3,749.37, after rising as much as 1.8 per cent to 3,845.36. The index gained close to 10 per cent in the previous three sessions.

“I’m not surprised by this sideways movement in market. Investors are not having a clear view of what might happen in the market. We have already taken a hit due to crude oil, and the majority of investors feel that current prices of crude oil are not sustainable,” said Sebastien Henin, head of asset management at The National Investor.

Crude oil extended losses to approach its lowest level in more than five and a half years after Goldman Sachs cut its price forecast to $40 (Dh146) a barrel. Crude was down 2.41 per cent lower at $48.90 a barrel, after losing as much as 3 per cent.

Oil slumped almost 50 per cent last year, the most since the 2008 financial crisis, amid a supply glut estimated by Qatar at 2 million barrels a day. Opec is battling a US shale boom by resisting production cuts.

Normal trading:

“This is normal trading, but we would be in a panic situation if Dubai index breaches 3,520,” said Osama Al Ashri, member of British organisation, Society of Technical Analysts. Resistance is pegged at 3,954/4,178.

Arabtec ended 0.34 per cent lower at Dh2.95, after rising as much as Dh3.09. Union Properties ended 2.42 per cent low at Dh1.21.

“Arabtec is still under risk may go below Dh2. Emaar may witness consolidation between Dh7-8,” said Al Ashri.

Dubai Financial Market shares declined after gaining more than 10 per cent in the previous two sessions after hints of a possible merger with Abu Dhabi Securities Exchange. The stock ended 2.9 per cent lower at Dh2.010.

“DFM will be go up again, and may hit to test resistance area of Dh2.27 within few weeks,” said Al Ashri. “Dubai Islamic Bank may hit resistance level of Dh7.20 to test new high. Dubai Islamic Bank ended Dh6.48 in trade.”

Out of a total of 34 shares traded on the exchange, shares of 21 companies fell, while about shares of 11 companies rose.

The Abu Dhabi Securities Exchange general index ended 0.68 per cent lower at 4,449.43.

ADX may witness consolidation, but may be risky for further downside if it hits support area of 4,367, Al Ashri said.

Aldar Properties may record new high around resistance area of Dh2.8. Aldar Properties ended the trade at Dh2.45. Waha Capital may witness consolidation between Dh2.6-2.95. Waha Capital ended trade at Dh2.85.

Out of a total 29 shares traded, shares of 18 companies fell, while three companies rose.