By Mahmoud Gamal
Dubai – Mubasher: The absence of market-boosting catalysts, thin liquidity and the lack of benefiting from external factors, such as the rise of oil prices, are the key elements that pushed the UAE stock markets down over the last sessions, analysts told Mubasher.
They affirmed that the timing of subscription for increasing the capital of some companies listed on the Dubai Financial Market (DFM) was not opportune that took its toll on liquidity.
By the end of Sunday’s trading session, the Dubai Financial market (DFM) inched down 0.14% to 3192.78 points, while the Abu Dhabi Securities Market (ADX) closed 0.21% down to 4533.11 points.
Lack of good news
Ending the period of announcing firms’ financial results and their subsequent dividend distributions dragged the Emirati stock markets down over the last week, CEO of Minecraft Consulting Fady Al-Ghattis said.
Most of blue-chip stocks listed on the twin UAE bourses saw a remarkable decline in the previous sessions, topped by Emaar Properties, Al-Ghattis added.
Thin trades are the only positive factor as they show that investors have not been on edge, the CEO noted.
The absence of local portfolios and major investors in the UAE bourses resulted in a low liquidity, that also affected by the capital hike of Dubai Islamic Bank and Emirates NBD, Al-Ghattis highlighted.
Low liquidity
Low liquidity was attributed to a slew of factors; local investors are shifting their interest to the other Arab stock markets, particularly the Saudi bourse, financial analyst Salam Saeed said.
Weak financial results of the UAE-listed firms and their low profits are other factors, Saeed added, noting that traders are concerned about the correction movement in the global stock markets, especially in the US bourses.
These elements propelled investors to be more cautious, letting speculation dominate the stock markets, the analyst highlighted.
The DFM is expected to remain at the levels of 3,000 points and 3,350 points, while the ADX may reach 4,500 points and 4,650 points until announcing the financial results of the first quarter of 2018, Saeed added.
Translated by: Kholoud Mohamed Hussein
