Foreigners net buyers on DFM

Foreign and institutional investors remained net buyers on the Dubai Financial Market (DFM) in August 2010 while GCC and UAE nationals were by far net sellers, indicating varying risk perceptions in a depressed market.

Foreign investors bought shares worth Dh779.2 m in August, comprising 52.3 per cent of the total value of stocks traded in the month, according to trading statistics for August released by DFM on Wednesday.

The value of stocks sold by them rose to Dh728.8 million, comprising 49 per cent of the total value of stocks on the bourse, thus showing a net investment inflow of Dh50.4 m.

DFM overall performance decreased by 1.9 per cent to reach 1483.7 points at the end of August 2010 compared to 1512.4 points at the end of July. The market capitalisation fell by 2.4 per cent to reach Dh189.3 billion compared to Dh194 billion at the end of July.

The value of shares traded during the month fell to Dh1.5 billion from Dh2.3 billion recorded during July, a decrease by 35 per cent.

Total volume of shares traded decreased by6 29.2 per cent to 1.1 bn against 1.5 bn shares in July 2010. Correspondingly, the number of transactions executed during August 2010 fell by 26.1 per cent to reach 23,700 compared to 31,100 deals carried out during July.

The real estate and construction sectors ranked first in terms of the value of traded shares followed by the transportation sector and investment and financial services sectors. The real estate counters accounted for transactions worth Dh936.8 m, comprising 62.9 per cent of the total value of shares traded in the market.

The value of stocks bought by institutional investors reached Dh570.5 million comprising 38.3 per cent of the total value of stocks traded during the period. They sold shares worth Dh409.2 m, constituting 27.5 per cent of the total value of stocks traded during the month. Net institutional investment on the market reached Dh161.3 m, as aggregate buy.

Individual investors comprised the largest chunk of trading as they bought stocks worth Dh917.85 m and sold Dh1.079 bn worth of shares.