Dubai:Emaar Properties’ shares on the Dubai Financial Market (DFM) were precariously positioned near its key support level as traders weighed in options whether to hold or sell the stock.
Emaar Properties closed down 0.84 per cent at Dh4.70, 8 per cent higher from its 50-day moving average of Dh4.30. Its shares have shed 5.8 per cent from a four-month high of Dh5.02 that was stuck on February 27. This followed a strong performance in the stock since February 13, accumulating 28 per cent in gains.
“Emaar Properties is a difficult one to call on a short-term basis. This may be not be a best time to invest in Emaar. Our valuation suggest that the current stock prices are factoring in unrealistic scenario,” an analyst who did not wished to be named told Gulf News.
Total shares traded have been on a declining trend. Volume came in at 4 million shares, as against 12 million shares that were traded during the upmove, indicating declining interest. Accordingly, total traded value on the bourse also fell to 81 million shares, down from an average of 98 million shares.
Emaar Properties had been on a uptrend after the company reported a 30 per cent increase in net profit last year, but traders have been wary about the future prospects of its shares.
“We expect Emaar to consolidate at current levels — after the up move from the low. It is important to note that the company continues to do reasonably well in a difficult macro environment,” Vrajesh Bhandari, senior portfolio manager with Al Mal Capital said.
Technically, analysts say that shares may see more downside.
“Buying which was seen at Dh4.70 fizzled and resulted in a lower closing. Immediate support level is seen at Dh4.70 which if broken shall extend fall to Dh4.40 target zone,” said Shiv Prakash, senior analyst with First Abu Dhabi Bank Securities.
In other shares, heavyweight Dubai Islamic Bank (DIB) also fell. DIB shares closed 0.77 per cent lower at Dh5.13. The weakness in Emaar Properties and DIB, which contribute to 31 per cent of the total weight on the index, resulted in a 0.63 per cent fall on the gauge. The Dubai Financial Market general index closed lower at 2,578.14.
The Abu Dhabi Securities Exchange general index closed 0.86 per cent lower at 4,872.08. Elsewhere in the Gulf, Saudi Tadawul index was 0.13 per cent lower at 8,468.07. The Muscat MSM 30 index closed 0.55 per cent lower at 4,090.20.