Property Stocks Buoy Shares

DUBAI — Property stocks pulled up UAE shares on Tuesday, with Emaar Properties surging to push the Dubai bourse to a two-month high, while Aldar Properties and Sorouh Real Estate buoyed 
Abu Dhabi.

By Rocel Felix

  • Follow us on
  • google-news
  • whatsapp
  • telegram

Published: Wed 12 Aug 2009, 10:48 PM

Last updated: Thu 2 Apr 2015, 3:45 AM

The benchmark index of the Dubai Financial Market rose by 1.2 per cent to 1,953.60, bringing it closer anew to the psychologically important 2,000 level reached on June 4. It was the index’s best closing since June 22 when it ended at 1,953.47.

“The next few sessions will need Dubai sustaining its gains before investors are emboldened to retest the 2,000 level again. That will be quite an uphill climb because of the absence of local investors as we go deeper into the summer,” said Vyas Jayabhanu, head of investments at Al Dhafra Financial Brokerage in Abu Dhabi.

The Abu Dhabi Securities Exchange index inched up by 0.6 per cent to 2,854.41. Volumes in both bourses also improved considerably from Monday’s Dh617.77 million, with shares traded in Dubai and Abu Dhabi hitting Dh1.06 billion. Shares also got a boost from rising oil prices, with Brent North Sea crude for delivery in September rising on Tuesday by 11 cents to $73.61 a barrel. In New York, light sweet crude for September gained 12 cents to $70.72 a barrel.

Emaar, the Middle East’s biggest property developer, jumped by 4 per cent to Dh3.35, its best finish since June 24 when it ended at Dh3.36. “Investors continue to see Emaar’s attractive valuations, its quarter earnings were encouraging in a number of fronts,” said Ali Khan, managing director at Arqaam Capital Limited.

“First, Emaar completed its write off of the losses of its US subsidiary, John Laing Homes. Its net margins should also improve further looking forward, especially with the opening of the Burj Dubai by the end of the year. That is making Emaar’s shares appealing despite the potential overhang from its merger plans,” added Khan.

Investors are keeping a close watch of the final structure of Emaar’s merger with the property companies of government-controlled Dubai Holdings.

Union Properties rose by a hefty 6.3 per cent to Dh1.18 on speculation ahead of its second quarter results announcements. Deyaar Development edged up by 1.3 per cent to Dh0.79, while contracting and engineering firm Drake & Scull International added 2.2 per cent to Dh0.93.

Major banks bucked the trend after Moody’s Investors Service late on Monday, said it is placing four banks under review for a possible downgrade because of the mounting woes of the banking sector reuslting from the economic slowdown.

Emirates NBD, the country’s biggest bank by assets gave up part of its nearly 5 per cent gains on Monday to end 1 per cent lower at Dh3.79. Emirates Bank International and National Bank of Dubai which merged to create Emirates NBD are being appraised by Moody’s.

Two other banks in Moody’s watch for potential downgrade are Dubai-listed MashreqBank and Dubai Islamic Bank. MashreqBank retreated by 4.9 per cent to Dh105.60. Dubai Islamic Bank edged up by 2.3 per cent to Dh2.64.Abu Dhabi-based investment company Aabar Investments climbed by 6.7 per cent to Dh2.85 after its announcement of a deal with five German firms to set up vehicle and manfuacturing plants in Algeria, the latest in a string of joint ventures by the unit of state-controlled International Petroleum Investment Company. Aldar Properties added 4.7 per cent at Dh4.46 after being given an ‘overweight’ rating by JP Morgan. Sorouh Real Estate edged up by 4.2 per cent to Dh3.20.


More news from