ADX displays bullishness with steady and firm trend

Abu Dhabi Securities Exchange displayed strong bullishness yesterday as it broke through its 2,585 points resistance level. The index added 54.98 points, or 2.16 per cent, to close at 2,597.95. The rally came amid moderate turnover with 196 million shares changing hands at a total value of Dh291 million. The rise was mirrored across the GCC markets as all the region's indices closed up on the back of strong global and regional positive sentiment regarding efforts to revive the world economy. Realty and construction stocks were the leading active players in the market and topped the list of active gainers with improving sentiment regarding the capital's real estate sector. The sector was the top gainer, adding 7.24 per cent. Heavyweight stocks in the banking and telecom sectors also supported the rally as they added 2.27 and 1.47 per cent, respectively. Sorouh, Aldar and Rakprop rallied strongly during the session and supported the index. Sorouh added 7.35 per cent to close at Dh2.68 while Aldar soared by 7.87 per cent to close at Dh3.77 and Rakprop advanced by 1.75 per cent to Dh0.58. Hossam Al Jundi, General Manager of Electronic Stock Brokerage, said he expected that the rally would continue at a steady and strong pace due to the high level of long-term investment and low volume of speculative movements on the market. "Speculators have limited room for quick movements on ADX due to regulations that narrow their opportunities for margin trading," he said. "So they focus on active stocks on DFM while long-term investments prefer selected stocks on ADX. We noticed some foreign investors who were injecting new liquidity in selected equities." Al Jundi said low volatility on ADX was a critical factor in the increasing long-term investment in the market. "We expect these steady and firm movements in the index to continue in the short term." Amjad Bakir, Trading Manager at Mac Sharaf Securities, said some stocks on ADX broke critical resistance levels yesterday and looked very bullish for the short term. "Aldar broke its critical resistance of Dh3.60 and it has a target of Dh4.56 in the short term," he added. Rak cement in focus Ras Al Khaimah Cement attracted strong buying interest yesterday as the stock added 3.88 per cent to close at Dh1.36. The rise came after the company announced that its net profit for the first quarter had more than doubled to Dh29.4 million, up from Dh10.2m during the same period last year. Earnings per share reached Dh0.061 in Q1 compared to Dh0.021 in Q1 2008. Taqa buy-back The Abu Dhabi National Energy Company (Taqa) yesterday announced that it bought five million of its shares last Thursday to increase the total number it had bought back to 104.5 million. The company said the average price paid was Dh1.96 per share. The buy-back programme allows the company to buy a total of 517.9 million shares. 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 .