Wednesday, Jan 16, 2013

Dubai: The Dubai Financial Market (DFM) index was yesterday closing in on highs not seen in nearly ten and a half months as excess liquidity on the global financial system, finally, seemed to be chasing some of the attractively-priced stocks on the prime Middle East bourse.

The bullishness lends credence to the theory that the market’s bull run which began at the beginning of the new year was no flash in the pan.

“The year has started positively for the market with both retail and foreign inflows. We have now effectively reached the highs of 2012 first quarter,” Anastasios Dalgiannakis, Head of Trading at Dubai-based Mubasher Financial Services told Gulf News.

“Most of the rally in 2012 reversed in the second quarter. However, this year we would expect the gains to be more resilient given that other asset classes such as bonds and real estate have already performed strongly. We may, however, see a pause at current levels,” he added.

Yesterday, the Dubai market was driven by investors’ buying in real estate major Emaar’s shares, Tabreed and DFM. However, profit-taking in construction major Arabtec, Ajman Bank and Gulf Finance House’s stocks pared the index’s gains. The DFM index closed 0.39 per cent higher at 1,741.31, its highest closing since March 5 when the index had closed at 1,754.27.

Overall, around 196.75 million shares cumulatively worth 218.9 million changed hands on the market. As many as 9.74 million Emaar shares cumulatively valued at around Dh39.9 million were traded, its stock closing 0.25 per cent higher at Dh4.08.

Abu Dhabi

The Abu Dhabi Securities Exchange (ADX) general index, however, fell 0.15 per cent yesterday on profit-taking by investors, mainly in real estate stocks such as Aldar Properties and Sorouh Real Estate.

“Banks and etisalat are the main drivers of the Abu Dhabi index. Aldar and Sorouh stocks also help. The performance of the Abu Dhabi market will be driven by the fourth quarter results of banking stocks and etisalat,” said Dalgiannakis.

The Abu Dhabi market since the beginning of 2013 has been witnessing a bull run, which took the index past 1,700 as global investors’ immediate fears on the US going over the fiscal cliff were allayed. The ADX general index closed yesterday at 2,769.67 with its bullish sentiments intact. Any news on the potential merger of the two Abu Dhabi real estate majors is going to be a major catalyst for the market, say experts.

By Himendra Mohan Kumar Staff Reporter

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