Dubai index seen extending losses

Select stocks witnessing aggressive buying ahead of re-weighting of UAE indices on May 12 by MSCI

Published: 18:24 May 3, 2015

By Siddesh Suresh Mayenkar, Staff Reporter

Dubai: Dubai index, which gained more than 20 per cent in April, may extend losses in the coming sessions even as select stocks may witness aggressive buying ahead of re-weighting of UAE indices next week.

On Sunday, the Dubai Financial Market General Index ended 2.28 per cent lower at 4,132.46, falling from a high of 4,247.16.

“We may pull back further and hit a support level of 4,000 levels,” Hisham Khairy, Head of Institutional Trading, Menacorp, a leading brokerage in UAE.

Another technical analyst also agreed that Dubai index may fall and witness a recovery later. “Dubai index will go down further to 3,907 to see an acceptable low price for May,” Osama Al Ashri, member of British organisation, Society of Technical Analysts said. The Dubai index hit a low of 3,488 on April 1.

“I still have positive outlook for short to medium, and may recover to 4,519,” Al Ashri added.

Union Properties ended 5.26 per cent lower at Dh1.44, and Arabtec also ended 4.73 per cent lower at Dh2.82.

Arabtec may fall further and hit a support level of Dh2.67, and may recover later to Dh3.54, Union Properties may hit a support level of Dh1.33, and may recover later to Dh1.77 in the next few weeks.

Gulf Finance House, which ended at Dh0.80 on Sunday, may hit support area of Dh0.75 and recover later, Al Ashri said.

Out of a total of 34 stocks traded on the exchange, shares of 26 companies fell, while shares of 6 companies rose.

MSCI re-weightage

There has been buying in bank stocks in Abu Dhabi ahead of the MSCI re-weighting of index on May 12.

“There is some talk that Abu Dhabi Commercial Bank, Emaar Malls, and Union National Bank that their weight would be increased, so these stocks have been witnessing a lot of foreign inflows,” Khairy said.

The MSCI would review the market again, and stocks that form a part of the index.

The UAE indices along with Qatar index were upgraded to emerging markets from frontier markets last year.

ADX to fall

Abu Dhabi Securities Exchange General Index ended at 4,618.87, down 0.61 per cent. “If ADX index breaches the support area of 4,525, we may decline to 4,180 in the next quarter,” Al Ashri said.

Eshraq Properties ended 3.88 per cent lower at Dh0.99, while Dana Gas ended 1.96 per cent lower at Dh0.50 ahead of the results later in the week.

Eshraq may go down again to touch support of Dh0.93 in short term, Al Ashri.

Elsewhere in the Gulf, Saudi’s Tadawul ended 0.71 per cent lower at 9,764.24 led by losses in banks and financial services.

Tadawul index may hit a new high and hit touch its resistance at 10,141 in the next few weeks, Al Ashri said.

tristique elit. neque. at accumsan consequat. mattis venenatis