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02 October 2023

ADX drifts up on sideways trading as banking and consumer stocks gain

By Sreenivasa Rao Dasari

The recent lacklustre trading on the Abu Dhabi Securities Exchange continued yesterday with the only action involving retail investors engaging in marginal speculative transactions.

Construction, realty, insurance, industrial and energy stocks closed in red while the telecom sector closed flat, but banking and consumer stocks helped the index to close on a positive note.

Mirroring the restricted trading, the general index closed at 2,730.54 points after netting a marginal gain of 5.79 points, or 0.21 per cent.

First Gulf Bank, Finance House, National Bank of Abu Dhabi, Sharjah Islamic Bank and Waha Capital closed higher. Without this support the market would have closed in the red as market heavyweights such as Abu Dhabi Commercial Bank, Aldar, Sorouh, Aabar Investments, Dana Gas, Taqa and Agthia closed witnessed selling pressure.

"The Abu Dhabi market is witnessing the same trading pattern as the DFM," Robert McKinnon, Chief Investment Officer at ASAS Capital, told Emirates Business. "The ADX is trading on low volumes. Oil prices are favourable but local fundamentals are have a greater influence on sentiment."

The ADX recorded another bleak trading session with turnover stuck at Dh85.12 million and just 36.89 million shares changing hands in 904 deals involving 34 stocks. The underlying market sentiment remained weak and 18 stocks declined, 10 advanced and six closed at their previous levels.

Aldar eased 1.67 per cent to Dh3.54, RAK Properties closed flat at Dh0.51 and Sorouh eased 0.93 per cent to Dh2.14. Energy stocks Aabar, which closed 1.38 per cent lower at Dh2.15, Dana Gas, down 1.22 per cent at Dh0.81, and Taqa, down 0.8 per cent at Dh1.24, attracted speculative selling deals.

Among the construction stocks Gulf Cement, RAK Cement and RAK Ceramic eased, while Arkan added 1.02 per cent to close at Dh1.99. Gulf Cement shares fell 2.36 per cent to Dh2.07, RAK Cement stock eased 1.79 per cent to Dh1.10 and RAK Ceramic fell 6.08 per cent to Dh1.70.

Finance House, Abu Dhabi National Hotels, NCTH, First Gulf Bank and GCIC were the day's top gainers, while Abu Dhabi National Takaful, Qatar Telecom, RAK Ceramic, Bildco and Abu Dhabi Ship Building were the major losers.

The ADX suspended trading in RAK National Insurance from next Monday onwards until the results of a board meeting are disclosed. There has been no trading in National Bank of Umm Al Quwain since February 24.

GCC slips into the red

All the GCC markets, with the exceptions of Saudi Arabia and the ADX, closed in the red yesterday and – reflecting the restricted range of trading – all the bourses moved in ranges of less than one per cent.

Sabic and Etihad Etisalat helped Saudi's Tadawul to close higher but yesterday's rise in oil prices to $80 a barrel failed to boost market sentiment.

The Qatar index eased as banking stocks faced marginal selling pressure.

All the GCC bourses are suffering from lacklustre trading owing to the liquidity crunch and a lack of interest among market players.

Positive global cues such as favourable oil prices and positive trading on the US and Asian bourses were unable to push the GCC bourses upwards as local factors influenced sentiment more.

Telecom stocks such as Zain Telecom and National Mobile Telecom pulled the Kuwait index lower.

Market players are likely to remain in wait-and-watch mode until they have a clear picture about a proposed stake sale to India's Bharti Telecom.


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