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Stocks Slip on Concerns Over Property Sector

DUBAI - Increasing worries about the moribund property sector and its impact on the broader economy pushed the UAE markets lower on Monday with Arabtec Holding dropping to an all-time low. The Dubai Financial Market general index shed 0.96 percent to 1,472.96 as property stocks fell 1.16 percent.

The Abu Dhabi Securities Exchange Index ended 1.46 percent lower to 2,193.68 with the real estate issues losing 4.5 percent. “Investors were in a holding pattern looking down and waiting for a reason to swoop. Uncertainty remains the key driver but I think that panic has been taken out of the equation,” said Matthew Wakeman, managing director of cash and equity linked trading at EFG-Hermes.

The markets were hounded by a barrage of negative news about the UAE property sector with analysts saying the number of projects being shelved or postponed is increasing.

With companies announcing significant layoffs, the expatriate population too is likely to come down impacting domestic demand and the profitability of the companies in the region.

Arabtec Holding, plunged 9.52 percent to a record low of Dh0.95, with the company denying rumors its CEO Riad Kamal resigned as the stock continues to get pummeled from a series of setbacks on its projects.

“The uncertainty surrounding the minds of investors still looms large as the scale and scope of the current financial crisis have taken the global economy into uncharted territories,” said Faisal Hasan, vice president and head of research at Global Investment House.

Bucking the trend, Dubai index mover Emaar Properties was steady, edging up 0.53 percent to Dh1.88.

“It’s very hard to draw any conclusions from individual stock moves. Emaar’s stability today could be investors positioning for upcoming results or could just simply be that sell tickets were completed,” said Wakeman.

In Abu Dhabi, Sorouh Real Estate plunged 4.81 percent to Dh2.53. Aldar Properties gave up 4.51 percent to Dh2.38.

rocel@khaleejtimes.com