DFM index inches up as investor appetite remains subdued

Dubai

The Dubai Financial Market (DFM) general index continued to trade in tight ranges on Thursday, ending the day only marginally higher as investor appetite remained subdued.

The DFM index closed at 3,042.82, up 0.55 per cent, as 23 out of the 35 traded stocks ended in the green. Most prominently, Emaar Properties and Dubai Islamic Bank, both of which weigh heavily on the overall index, rose 2.96 per cent and 0.93 per cent respectively.

Emaar was the most actively traded stock on DFM in terms of value, accounting for 17 per cent of the total traded value. And while Dh190.5 million in total traded value is higher than some of the sub-Dh100 million trade values seen in earlier sessions this month, values on DFM remain low.

“I don’t think 2018 will be the year for the UAE markets,” said Marwan Haddad, lead portfolio manager at Al Mal Capital.

“Investor sentiment is burnt from the smaller companies … And real estate sentiment will still weigh down on Emaar, so I would say Emirates NBD is probably the most exciting name this year on DFM.”

Last month, Emirates NBD’s shareholders approved a move to increase foreign ownership of the bank’s shares to up to 20 per cent. Haddad said increasing that limit would unlock value for Emirates NBD, one of the UAE’s largest banks.

Asked about other stocks on which he was bullish, Haddad pointed to Aramex, which is expected to benefit from growth in the e-commerce sector in the UAE.

“Some of their big clients are from the oil industry, so they will benefit from better economic conditions. Of course, e-commerce will keep fuelling their bottom line, and they’re doing restructuring, so we should expect better efficiencies and better net profit margins and costs,” Haddad said.

Also on DFM, GFH dipped 0.79 per cent, as DXB Entertainments gained 3.66 per cent, and Dubai Investments fell 5.85 per cent.

Elsewhere, the Abu Dhabi Securities Exchange (ADX) general index inched up 0.56 per cent to end at 4,697 as trade continued to concentrate on names that include Dana Gas, First Abu Dhabi Bank, and Aldar Properties.