By: Mahmoud Gamal
Dubai – Mubasher: The Dubai Financial Market’s (DFM) general index dropped 5.9% or 215.7 points to 3,420.17 points in November, hitting the lowest monthly level since October 2015.
The exaggerated concerns regarding the geopolitical atmosphere in the region propelled investors to sell shares in Novembers, Wadah Al-Taha, member of the National Advisory Board of Chartered Institute for Securities and Investments (CISI) told Mubasher.
Speculations and fluctuations were the title of November’s transactions on the DFM, Al-Taha added.
During the months, the real estate sector shed 9.6% after Arabtec Holding tumbled 16.7%, while Emaar Properties dropped 8.9%.
The investment sector went down 5.6% on the back of Dubai Investments and the DFM Company, which lost 6.5% and 5.2%, respectively.
Over the months, the DFM’s trading volume nearly halved to 3.6 billion shares from 6.2 billion shares in October, while the market’s turnover declined to AED 6.9 billion, compared to AED 8.61 billion in the previous month.
GFH Group’s stock speculations
A good instance of the strong speculations carried out on the DFM in November were those conducted on GFH Group’s shares, which acquired 22% of the market’s liquidity, Al-Taha continued.
GFH Group rose 4.3% with a turnover of AED 2 billion after the listing of the stock on the Saudi Stock Exchange (Tadawul).
Speculations boosted GFH Group in the first nine months of 2017, and during 2016, the analyst noted.
Domestic markets made it clear in November that they were not to be affected by the global markets and oil sector, which grew considerably over the month, Al-Taha remarked.
The new IPOs
The main theme in November was the new IPOs, especially Emaar Development’s, which was listed on the DFM and began with disappointing performance, Al-Taha stated.
However, the stock is still attractive in terms of dividends - dividends exceed the average of the UAE’s listed companies by 50%, CISI’s member revealed.
The Market Gap
Al-Taha stressed that there was a gap between the DFM’s negative performance in November and the strong financial status of the UAE, adding that IPOs would bridge this gap.
Mergers are another option for bridging this gap, as it returned again to the UAE’s market, the analyst concluded.
Translated by: Muhammad Khalid
