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Dubai bourse advances but convincing rally unlikely |
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1/13/2009 10:24:13 AM |
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Improving turnover helped the Dubai bourse advance for a second session, but there is little prospect of a convincing rally in the short term and some analysts warn it could be poised for another slump this week.
Investors are nervously awaiting the fourth quarter results, which will begin to trickle out from the end of this week, to see if their worst fears have been confirmed.
In the meantime, the Dubai Financial Market climbed 1.23 per cent to 1,757 points following gains in seven of its 10 largest stocks.
Of these, DFM Company was the star after surging 4.5 per cent to Dh1.39, while Dubai's beleaguered property developers also shone.
Emaar added 2.9 per cent to Dh2.48, while Deyaar and Union Properties increased by 1.85 and 3.84 per cent respectively. Emaar will only turn bullish if it breaks Dh2.80.
"There's very little incentive for investors and we won't see any significant moves apart from on a stock specific basis until the fourth quarter results come out," said Julian Bruce, EFG-Hermes director of institutional equity sales.
"The expected Q4 figures have already been priced in, and the assumption is that they will be appalling from a quarter on quarter perspective, but there should be some positive and negative surprises."
The DFM's General Index opened well to make early gains before slipping below its opening level. It then mounted a decent surge mid-session to hit a high of 1,775, but it then again stumbled to end below its immediate resistance of 1,768.
Technical analysts say the Dubai index will trade between 1,700 and 1,800 points for the time being, with the latter mark providing critical resistance. "The market will continue to move in a fairly tight range and track sideways for the time being, with sporadic volatility," said Bruce.
With the market beset by low volumes, the index is likely to slide lower, according to and Sherif Abdul Khalek, Beltone Financial institutional trading manager. "Dubai will be flat for the rest of the week and if it can't break 1,800, then the DFM could slip back to challenge 1,650 again," added Khalek.
Gainers outnumbered losers 15:6, with Shuaa Capital and Dubai Islamic Bank notable members of the latter group after falling 5.6 and 2.5 per cent respectively. The latter is one of Dubai's best performers this year having 19 per cent in the six trading sessions of 2009. Gulf General Investments also declined, slipping 4.4 per cent to a 50-week low of Dh4.75.
Turnover hit a three session high of Dh308 million after seeing 198m shares change hands. Emaar was most active with 39m shares worth a combined Dh97m traded, while Arabtec's Dh65m placed it second and DFM Co was third with Dh42m. Arabtec is slowly recovering from this month's shock cancellation of its $1.3bn (Dh4.7bn) project to build the Meydan horseracing project.
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Source: Business24-7.ae |
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