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Wealthy investors push UAE stocks up
Fundamental change in the market may still be absent but stocks show people are buying on expectations.
March 24, 2011 5:09 by Reuters
Dubai’s index hit a new five-week high and Abu Dhabi also gains, with the UAE’s safe haven status attracting high net worth investors.
Arabtec and Emaar Properties climb 3.2 and 3 percent respectively while Drake & Scull adds 1.9 percent.
This trio account for more than a third of all shares traded on Dubai’s benchmark, which rises 1.5 percent to 1,552 points, its highest finish since February 16, although it is still down 4.8 percent in 2011. Volumes hit a five-month high.
“We’re seeing some action from high net worth individuals, who are coming back to the market to build positions,” says Samer al-Jaouni, General Manager of Middle East Financial Brokerage Co.
Abu Dhabi’s index climbs 0.2 percent to 2,633 points, an 11-day high.
Bluechips rally, with Aldar Properties gaining 4 percent and Sorouh Real Estate climbing 4.2 percent.
“Sentiment is positive and we’re not reacting to any negative moves on other markets,” says Jaouni.
“I can’t say anything has changed in terms of fundamentals or there’s actual news in the market.
“But maybe people are buying on expectations for the coming period, bearing in mind the UAE is politically stable and this will provide advantages.” Volumes on the Abu Dhabi bourse fluctuate drastically, with Thursday’s traded shares at almost half of Wednesday’s.
“Whenever the market has gone up recently, volumes have been high, but when it has fallen, volumes have been relatively small, which is a positive signal,” says Jaouni.
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