Investors go on a selling spree

DUBAI — Disappointed with the second quarter financial performance of property major Emaar, investors went on a selling spree on UAE bourse yesterday resulting in all key market indices closing substantially lower.

By A Staff Reporter

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Published: Mon 18 Jul 2005, 10:32 AM

Last updated: Thu 2 Apr 2015, 4:42 PM

The market benchmark National Bank of Abu Dhabi General Index fell by 523 points (3.25 per cent) to close at 15,291 points while the Dubai Financial Market General Index was down by 2.75 per cent at 879.51 points. While the Emaar counter accounted for more than 70 per cent of the total turnover on DFM, other market heavy weights including Amlak, Shuaa Capital, Commercial Bank of Dubai, Dubai Islamic Bank, National Bank of Dubai and Etisalat shares fell in the range of 2 to 4.5 per cent. “Although the Emaar results can't be termed as bad in absolute terms, a marginal fall in profits from the first quarter had a big psychological impact on the investors. In addition the market had anticipated a lower prices for the rights issue” said an analyst.

As the prices of the market pivotals fell, the bourses reported large volumes and turnover yesterday, indicating the overall bearish trend. Across the two bourses the market traded more than Dh2.6 billion up by 62 per cent from Saturday. While the Emaar counter reported a large turnover, market sources said, some of the bear operators are targeting the stock to take advantage of the current market sentiments. The scrip opened at Dh40 and climbed to Dh42 but was soon hammered down to Dh37.25. In a later rally, the share again moved above Dh40, soon to be pushed down to 38. The scrip closed at Dh39. “The pattern of trading indicated that there is a bear lobby specifically targeting the Emaar scrip,” said a broker.

In 5479 trades the DFM traded more than 101 million (up by 36 per cent) shares worth Dh2.5 billion. In the service sector, the Arabtec share fell by 50 fils (3.5 per cent) to close at Dh13.80. While the Shuaa scrip was down by 4.6 per cent, Tabreed and Union Properties also slipped by 50 fils and 5 fils respectively.

In the Banking sector, despite the 70 per cent increase in the second quarter net, the Emirates Bank scrip fell marginally by five fils. The Commercial Bank of Dubai was posted a big loss of Dh10.40 while, Dubai Islamic Bank and National Bank of Dubai shares fell by 3.8 per cent and 3.5 per cent respectively.

“The current price trends in the market indicate that sustained corporate results alone can't lift the share prices. In many shares, valuations have hit the roof and it is time the market discovered sustainable prices on its own.

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