Emaar lifts Dubai to two-week high
Investors' confidence begins to return as fears over global economy recede and oil prices rise.
June 21, 2010 3:53 by Samuel Potter
Emaar Properties surged on Sunday, lifting the Dubai index to a two-week high, on improved investor sentiment and hopes for positive second-quarter results.
Saudi stocks rose in line with most other regional bourses, buoyed by higher crude oil prices, as investors shrugged off worries about global economic difficulties.
Emaar, the Arab world’s largest-listed property developer, gained 8.6 percent to a three-week high, accounting for nearly a third of stocks changing hands on the Dubai exchange.
“The negative themes are priced in, there are no sellers of size left in the market,” said Ali Khan, managing director and head of brokerage at Arqaam Capital.
“Emaar’s projects are on schedule, there is no negative, no headwinds on the stocks … the background is increasingly improving,” he added.
Emaar said last week it was handing over part of the operations of its Hamptons International subsidiary to British estate agency Countrywide, as it focuses on the Middle East and North Africa.
Other real estate-related stocks such as Arabtec and Union Properties also gained, advancing 6 percent and 1.6 percent respectively.
Low-cost carrier Air Arabia gained 1.7 percent. Bahrain-based Sico Investment Bank initiated coverage of the stock with a long-term “buy” recommendation.
Last week, HSBC raised Air Arabia to “overweight” from “neutral.”
Property stocks also dominated trading in Abu Dhabi, helping lift the index 0.8 percent.
Aldar Properties and Sorouh Real Estate gained 4.7 percent and 1.6 percent respectively.
On the Saudi bourse, heavyweight Saudi Basic Industries (SABIC) ended 2.2 percent higher, lifting the Tadawul All-Share Index (TASI) 1.1 percent.
“For the market, it was a positive day with the only loss in the Insurance sector, which was down 0.37 percent,” the Financial Transaction House (FTH) said in its daily market commentary.
Gains ranged from 0.08 percent in the Media & Publishing to 1.97 percent in the Petrochemical Industries. The overall market breadth was positive, with 78 advancers and 39 decliners recording an AD ratio of 2.0.
“With the market closing today at the top of the range with a strong liquidity of SR3.84 billion, we could expect possibly to see further gains tomorrow,” the FTH said on Sunday.
In Kuwait, Zain advanced 5.6 percent, as the telecoms firm recouped some losses from the previous week, helping lift the index 0.9 percent to 6,641 points. “It has bounced to above the 6,500 level, which is a decent support,” said a Kuwait-based trader.
The trader said he did not expect in the coming weeks “a major bounce, probably most sideways trading with more scope for a positive than a negative move.”
Benchmarks in Qatar and Oman also rose, ending 0.6 percent and 0.4 percent higher respectively.