Dubai index tops 2,000 mark

Dubai's stock index closed above 2,000 points on Tuesday for the first time since November 2009, boosted by optimism over corporate earnings, while most other Gulf markets also ended in positive territory.

The Dubai index advanced 1.8 per cent to 2,021 points, breaking above a psychologically important level and taking year-to-date gains to 24.6 per cent. It is the best-performing market in the region in 2013, thanks to increased optimism towards the emirate's economy as its real estate market recovers from the 2009-2011 crash.

The high number of shares changing hands on Tuesday - 255.1 million - bodes well for further gains, said Marwan Shurrab, vice president and chief trader at Gulfmena Investments.

"If we break 2,000 with good turnover, it will point towards the second big rally of the year," he said.

Interest on Tuesday was mostly centred around mid-cap stocks, with Air Arabia 4.1 per cent higher and Dubai Investments up 3.6 per cent. They were the two most heavily traded shares.

However, financial stocks continued their recent rise, with Emirates NBD, which gained 2.5 per cent, at a nine-month high, and Dubai Islamic Bank, up 2.0 per cent, flirting with a three-year peak.

In Abu Dhabi, banking shares also performed well, with Abu Dhabi Commercial Bank advancing 4.9 per cent to its highest close since August 2008 and Union National Bank up 4.2 per cent.

First Gulf Bank advanced 2.3 per cent to 15.40 dirhams, above a technical resistance level, according to Global Investment House. "If it trades above 15.17 dirhams, we expect it to continue rising and hit our price target of 15.63 dirhams and 16.20 dirhams in the coming trading sessions," it said.

The Abu Dhabi index climbed 1.1 per cent to its highest close since October 2009.

After the close National Bank of Abu Dhabi, the United Arab Emirates' largest lender by market value, confirmed the strong trend in bank earnings by posting a 35.5 per cent increase in first-quarter net profit. It made 1.41 billion dirhams ($383.9 million), well above analysts' average forecast of 1.09 billion dirhams - though the jump was due to income from investments and fees; loan growth stayed modest.

Qatar's benchmark posted its biggest one-day advance since Jan. 3 as it climbed 1.1 per cent, helped by Industries Qatar. The stock jumped 4.0 per cent - its largest one-day gain for more than two years - after posting estimate-beating first-quarter earnings on Monday.

Kuwait also continued its upward trend, gaining 0.5 per cent. It was the bourse's third straight gain and a fresh 29-month high.

"The market continues to push forth towards new boundaries," said Fouad Darwish, head of brokerage at Global Investment House.

"The fear of a market sell-off induced by profit-taking is no longer as haunting as it used to be. But we also do not negate the possibility nor the need for a correction movement in the coming days," he said, adding that day traders in Kuwait were helping to provide some cushion to any selling pressure.

Egypt's benchmark rose 0.4 per cent, boosted by a 1.5 per cent gain by heavyweight Orascom Construction.

The firm said in a statement on Tuesday that it was in advanced talks with the Egyptian Tax Authority over the probe into alleged tax evasion in the sale of Orascom Building, a subsidiary, to French firm Lafarge.

Any resolution of the dispute, if it is perceived by the market as fair to Orascom, could help to repair investor confidence in authorities' attitude to the market as a whole - besides potentially clearing the way for a buyout offer for Orascom shares from its Amsterdam-listed affiliate to go ahead.

In Saudi Arabia, PetroRabigh dropped 2.4 per cent, compounding the 9.9 per cent slump it suffered in the previous session on poor first-quarter earnings and its warning that second-quarter profit will be hit by a shutdown of its ethane cracker for maintenance. The Saudi index closed flat.

Oman's index snapped a five-session losing streak, gaining 0.2 per cent.

TUESDAY'S HIGHLIGHTS

DUBAI: The index jumped 1.8 per cent to 2,021 points.

ABU DHABI: The benchmark climbed 1.1 per cent to 3,188 points.

QATAR: The benchmark gained 1.1 per cent to 8,535 points.

KUWAIT: The measure rose 0.5 per cent to 7,174 points.

EGYPT: The measure rose 0.4 per cent to 5,237 points.

SAUDI ARABIA: The index ended flat at 7,124 points.

OMAN: The index edged up 0.2 per cent to 6,143 points.

BAHRAIN: The index edged down 0.2 per cent to 1,086 points.

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