The Abu Dhabi Securities Exchange (ADX) mirrored the DFM in its movements, experiencing bullish trading at the beginning of yesterday's session but being unable to sustain the gains.
The ADX index fell 8.31 points, 0.39 per cent, to close at 2,137.15 yesterday.
Sorouh and Aldar continued to create high pressure on the index after they hit their lower levels and closed at Dh2.14 and Dh1.98 respectively. The turnover advanced slightly, compared to the previous session as 85.1 million shares changed hands at a total value of Dh199.4 million.
Expectations were high the market would rebound after five sessions of decline. There were other factors influencing this expectation, such as the rally in regional and global markets during the last two sessions, as well as the rally in oil prices.
However, the sluggish real estate and banking sectors increased the pressure on the index. "Any bounce now seen in the market is being used to exit. Markets are facing selling on intraday resistance levels and are still trading below the important resistance levels on the daily charts. The previous lows in the DFM and the ADX are acting as the minor support levels. Any breakdown on these supports can again be bearish for the markets," said Shiv Prakash, technical analyst at MAC Capital Advisors.
The ADX advanced more than one per cent at the beginning of the session, but according to analysts, strong selling by institutional investors, both local and foreign, led to the bounce back in the index.
"There is unprecedented behaviour in the market due to the severe lack of confidence. There are unjustified movements in the market because there are strong hesitations among investors to build long-term positions in the market," said Mohamad Al Beheiri, trading manager at Amanah Financial Services. He said the selling pressure by local and foreign funds during the intraday trading hit the indexes after they bounced in the session's beginning.
The Bank of Sharjah has denied the presence of any critical news that may justify the sudden appreciation of its stock in the Abu Dhabi Securities Exchange during the last few sessions.
The bank stressed that there is no changes in its financial statements. In a message to the ADX, the bank said its stock declined below its nominal value last month, which created a chance for some investors and this may be playing a role in the strong appreciation of the stock. The stock advanced 3.36 per cent to close at Dh1.54 yesterday.
FGB buy back
First Gulf Bank has repurchased a total of 11.65 million of its shares since the Securities and Commodities Authority granted the approval for the buyback process last November. FGB disclosed that it purchased 500,000 shares on Monday at an average price of Dh7.65 per share.
The FGB stock closed flat at Dh7.65 yesterday, despite rallying to Dh7.69 during intraday trading.