08 October 2009
A rush of profit taking in the final 30 minutes of trading pared early gains on the Dubai Financial Market and pulled the index into the red.
Both individual investors and institutions booked profits, and major targets Gulf Finance House (GFH), Gulf Navigation, Union Properties and DFM dragged the general index down marginally by 7.91 points, or 0.35 per cent, to 2,265.28, compared to the previous day's 2,273.19.
"The last 30 minutes of trading saw quick profit taking but apart from that the index was trading higher throughout the session," said Sanyalaksna Manibhandu, an equity analyst at Arqaam Capital. "This profit booking was probably healthy for the market."
Mathew Wakeman, Managing Director for Cash and Equity-linked Trading at EFG-Hermes, said: "We saw a welcome technical sell-off that relieved some of the pressure that had built up this week."
The DFM opened positively at 2,295 points and climbed further to cross the 2,300-mark on sustained buying of Emaar and Dubai Islamic Bank (DIB). However, the index then lost ground and slipped to below 2,280 points at 11.45am as Deyaar, Ekttitab, du, and GFH came under pressure.
"Following a strong start to the session the market failed to hold the first test of 2,300 since last November," added Wakeman.
Banking and financial stocks lifted the index above 2,290 points again. And, mirroring the bullish mood, DFM witnessed Dh1.37 billion worth of transactions by 12.40pm and this saw the index soar to 2,312.16 points, which remained the day's high. The profit taking saw the index spiralling down by 45 points in the last hour of the session.
"We expect the market to consolidate early on today before taking its direction from the other Gulf markets and Europe," said Wakeman. "Investors have one eye on third-quarter earnings and are buying large caps in anticipation of earnings, though this hasn't proved to be a lucrative plan in recent times."
DFM shares fell 2.37 per cent and closed at Dh2.47. Drake & Scull International (DSI) shares eased 1.79 per cent and closed at Dh1.10 despite the news that the company has been awarded a Dh400 million contract in Abu Dhabi. This is the seventh project announced by DSI in 2009 and the total value of these projects is more than Dh2bn.
The other real estate majors such as Arabtec, Deyaar and UPP slipped into the red as the stocks fell 2.52 per cent, 3.33 per cent and 1.82 per cent and closed at Dh3.57, Dh0.90 and Dh1.10 respectively. Nineteen stocks declined, nine advanced and four remained unchanged.
Manibhandu said: "Unless we see fresh triggers in the form of positive news, profit taking is likely to continue till the end of October or until third-quarter results. If third-quarter results are not encouraging then profit booking will be severe."
All the sub-indices apart from banks and materials closed in the red. The telecom index lost the most, falling 2.61 per cent, and was followed by the finance/investment index at 2.29 per cent, utilities 1.82 per cent, transport 0.90 per cent, real estate index 0.61 per cent and insurance 0.07 per cent.
The materials index moved up by 1.45 per cent and the banks index gained 1.07 per cent. The day's top gainers were Al Firdous, Dubai National Insurance and Re-Insurance (DNIR), Emirates NBD, National Cement Company (NCC) and DIB.
Emirates NBD moved up 1.82 per cent to close at Dh4.48 and NCC added 1.45 per cent and closed at Dh3.50. DIB gained 1.26 per cent and closed at Dh3.22, while DNIR closed 2.86 per cent higher at Dh2.52. Al Firdous gained the most, rising by 4.31 per cent to close at Dh1.21.
Emirates NBD and DIB pushed the banking index up, while Al Salam-Bahrain, down 0.89 per cent at Dh1.12, Al Salam-Sudan, down 4.8 per cent at Dh2.71, and GFH, down 9.75 per cent at Dh2.77, came under pressure.
High volumes hold the key
The DFM continuing its trading volume binge yesterday as it recorded turnover close to the Dh2 billion-mark for a second session running. The market witnessed a trading value of Dh1.97bn compared to Dh1.96bn on Tuesday, Dh1.36bn on Monday and Dh551.57bn on Sunday.
"Almost Dh2bn on Tuesday and Dh2bn yesterday reveal the underlying positive tone of the market," said Sanyalaksna Manibhandu. "This higher level of trading turnover is a sign that investors are trading in more than one round.
"In addition, the global markets, including Nasdaq and NYSE, were trading higher. The interest rate hike by Australia sent a clear sign of recovery in its economy, while the US markets are also moving in tandem with these cues."
The DFM recorded trading volume of more than 978 million shares in 16,557 deals in 32 stocks. Mathew Wakeman said: "Third-quarter results will show whether valuations are still cheap or if the markets have run ahead of themselves by pricing in anticipated future growth."
A rush of profit taking in the final 30 minutes of trading pared early gains on the Dubai Financial Market and pulled the index into the red.
Both individual investors and institutions booked profits, and major targets Gulf Finance House (GFH), Gulf Navigation, Union Properties and DFM dragged the general index down marginally by 7.91 points, or 0.35 per cent, to 2,265.28, compared to the previous day's 2,273.19.
"The last 30 minutes of trading saw quick profit taking but apart from that the index was trading higher throughout the session," said Sanyalaksna Manibhandu, an equity analyst at Arqaam Capital. "This profit booking was probably healthy for the market."
Mathew Wakeman, Managing Director for Cash and Equity-linked Trading at EFG-Hermes, said: "We saw a welcome technical sell-off that relieved some of the pressure that had built up this week."
The DFM opened positively at 2,295 points and climbed further to cross the 2,300-mark on sustained buying of Emaar and Dubai Islamic Bank (DIB). However, the index then lost ground and slipped to below 2,280 points at 11.45am as Deyaar, Ekttitab, du, and GFH came under pressure.
"Following a strong start to the session the market failed to hold the first test of 2,300 since last November," added Wakeman.
Banking and financial stocks lifted the index above 2,290 points again. And, mirroring the bullish mood, DFM witnessed Dh1.37 billion worth of transactions by 12.40pm and this saw the index soar to 2,312.16 points, which remained the day's high. The profit taking saw the index spiralling down by 45 points in the last hour of the session.
"We expect the market to consolidate early on today before taking its direction from the other Gulf markets and Europe," said Wakeman. "Investors have one eye on third-quarter earnings and are buying large caps in anticipation of earnings, though this hasn't proved to be a lucrative plan in recent times."
DFM shares fell 2.37 per cent and closed at Dh2.47. Drake & Scull International (DSI) shares eased 1.79 per cent and closed at Dh1.10 despite the news that the company has been awarded a Dh400 million contract in Abu Dhabi. This is the seventh project announced by DSI in 2009 and the total value of these projects is more than Dh2bn.
The other real estate majors such as Arabtec, Deyaar and UPP slipped into the red as the stocks fell 2.52 per cent, 3.33 per cent and 1.82 per cent and closed at Dh3.57, Dh0.90 and Dh1.10 respectively. Nineteen stocks declined, nine advanced and four remained unchanged.
Manibhandu said: "Unless we see fresh triggers in the form of positive news, profit taking is likely to continue till the end of October or until third-quarter results. If third-quarter results are not encouraging then profit booking will be severe."
All the sub-indices apart from banks and materials closed in the red. The telecom index lost the most, falling 2.61 per cent, and was followed by the finance/investment index at 2.29 per cent, utilities 1.82 per cent, transport 0.90 per cent, real estate index 0.61 per cent and insurance 0.07 per cent.
The materials index moved up by 1.45 per cent and the banks index gained 1.07 per cent. The day's top gainers were Al Firdous, Dubai National Insurance and Re-Insurance (DNIR), Emirates NBD, National Cement Company (NCC) and DIB.
Emirates NBD moved up 1.82 per cent to close at Dh4.48 and NCC added 1.45 per cent and closed at Dh3.50. DIB gained 1.26 per cent and closed at Dh3.22, while DNIR closed 2.86 per cent higher at Dh2.52. Al Firdous gained the most, rising by 4.31 per cent to close at Dh1.21.
Emirates NBD and DIB pushed the banking index up, while Al Salam-Bahrain, down 0.89 per cent at Dh1.12, Al Salam-Sudan, down 4.8 per cent at Dh2.71, and GFH, down 9.75 per cent at Dh2.77, came under pressure.
High volumes hold the key
The DFM continuing its trading volume binge yesterday as it recorded turnover close to the Dh2 billion-mark for a second session running. The market witnessed a trading value of Dh1.97bn compared to Dh1.96bn on Tuesday, Dh1.36bn on Monday and Dh551.57bn on Sunday.
"Almost Dh2bn on Tuesday and Dh2bn yesterday reveal the underlying positive tone of the market," said Sanyalaksna Manibhandu. "This higher level of trading turnover is a sign that investors are trading in more than one round.
"In addition, the global markets, including Nasdaq and NYSE, were trading higher. The interest rate hike by Australia sent a clear sign of recovery in its economy, while the US markets are also moving in tandem with these cues."
The DFM recorded trading volume of more than 978 million shares in 16,557 deals in 32 stocks. Mathew Wakeman said: "Third-quarter results will show whether valuations are still cheap or if the markets have run ahead of themselves by pricing in anticipated future growth."
By Sreenivasa Rao Dasari
© Emirates Business 24/7 2009
