ADX advances on support of speculative buying

The Abu Dhabi Securities Exchange (ADX) yesterday registered its biggest intra-session gain in the past one month and closed 52.80 points or 2.16 per cent up on the back of speculative buying. The ADX index ending at 2497.40 yesterday, compared to its previous close at 2,444.60 points, as most active stocks got accumulated at lower levels. Speaking to Emirates Business , Vyas Jayabhanu, Head of Al Dhafra Financial Broker, said: "There was a small correction after a magnitude of loss. Sorouh's results were disappointing, but the market was anticipating this. "Since it's only a technical correction, I don't think buying support will continue further. Because of the liquidity crunch and cash flow problems, there may not be any further buying in the market. There's no fear of further losses as long as the market is above the Decmber-January lows." Since the market had already discounted the expected bleak first-quarter results, active investors are now trading on the actual numbers, he said. Mathew Wakeman, Managing Director for Cash and Equity-Linked Trading at EFG Hermes, said: "The real estate sector's earnings have been disappointing but that was already in the price and so isn't proving to be the banana skin that some predicted. "Any signs of recovery in the sector will grab the interest of investors – especially for the Abu Dhabi large caps Aldar and Sourouh – given the different demand profile and development curve to Dubai. Investors have also regained focus on Dana Gas, given its strong business model and earning potential going forward." Good buying was seen in the stocks of UNB, Dana Gas, Taqa, RAK Properties, Waha, Aabar, Aldar and Sorouh, which recovered from lower levels. Shiv Prakash, Technical Analyst at MAC Capital, said: "Waha took the neckline supports of Dh0.64 and went higher by 4.48 per cent to close at Dh0.70. Except a few illiquid stocks, almost all active stocks witnessed buying." Energy, real estate, industrial and banking indices were the major gainers on the bourse. The sectors that closed in the red were insurance, consumer and health care. "The DFM and the ADX have good support at the present levels, but a breakout will prove tough in the near-term unless the global picture improves. A sideways consolidation here, although unexciting, would be healthy and give a good base to push higher from," Wakeman said. Added Shiv Prakash: "A good positive close brings back the confidence in the markets." 25 scrips surge The ADX moved up on thin volumes as the turnover stood at Dh276 million. About 159 million shares were traded in 3,630 transactions on the capital bourse. While six stocks declined, 25 scrips advanced and one remained unchanged. The total number of companies traded on the bourse was 32. Union National Bank, Commercial Bank International, National Marine Dredging, Abu Dhabi Islamic Bank and Dana Gas were the major gainers. The list of most active scrips in terms of volume and value include Aldar, Sorouh, RAK Properties, etisalat and Dana Gas. Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here .