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UAE Shares Rebound after Week-long Losses

After losing nearly 18 per cent last week, the Dubai Financial Market Index advanced 2.9 per cent to 1,633.42, the biggest one-day rise since November 27 this year.

Abu Dhabi’s benchmark index which lost 15.6 per cent in the previous week, rose slightly by 1.6 per cent to 2,318.73.

In both markets, property shares rose more than 6 per cent while banking shares in Abu Dhabi gained 2.16 per cent.

“After last week’s losses, markets are in a correction mode and we should see more of that in the last two days of trading this week,” said Hesham Bakry, head of Middle East and North Africa institutional sales at Al Futtaim HC Securities.

Emaar Properties, the Middle’s East biggest property developer, surged 5.8 per cent to Dh2.34.

Union Properties rebounded strongly, it was up 14.3 per cent to Dh0.80.

The country’s largest construction company, Arabtec Holding jumped 14.7 per cent to Dh 4.58 as investors snapped up shares head of the expiration tomorrow of its shareholder bonus entitlement.

Markets were boosted by rebounding oil prices following violence at the Gaza Strip which raised concerns supply from the Middle East may be interrupted, and as some Opec members like the UAE jumpstarted oil output cuts to stabilise oil prices.

Crude oil prices gained for a second day, with February delivering up by $2.11 per barrel or 5.6 per cent to $39.82 at the New York Mercantile Exchange.

Recent incessant price slides due to deepening fears global recession will cut fuel demand, have heightened concerns about governments in oil-rich countries curtailing spending and subsequently, stifling economic expansion.

“An oil price increase is good news, it is always welcome news,” said Vyas Jayabhanu of Al Dhafra Financial Brokerage.

At the Abu Dhabi Securities Exchange, Sorouh Real Estate, the emirate’s second largest property company surged 7.6 per cent to Dh3.03. Top-ranked Aldar Properties gained 6.2 per cent to Dh3.93.

First Gulf Bank led winners in the banking sector, gaining a hefty 9.6 per cent to Dh 8.56. Union National Bank roser 8.2 per cent to Dh0.14.

“Stocks are at very attractive levels after a string of declines,” said Bassam Ramahi of Shuaa Securities.

“We should see stock prices stabilising in the short-term. Although volumes continue to be very low, that should be seen as a good sign, it means selling pressure is diminishing.”

· rocel@khaleejtimes.com