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03 March 2024

ADX makes gains to end three-session losing streak

By Matt Smith

The Abu Dhabi Securities Exchange made minor gains yesterday to end a three-session losing streak, despite three of its four largest stocks declining.

Like Dubai, the ADX also enjoyed increased trading, but this was mostly the result of investors offloading the capital's real estate stocks. The ADX edged up 0.57 per cent to 2,515 points.

"Both markets have been moving in a flat range for the past few sessions as investors take a wait and see approach," said Sherif Abdul Khalek, Beltone Financial institutional trading manager.

"The fourth quarter results should be a catalyst for increased trading, but foreign institutional presence is at a minimum and there is scant contribution from high net worth investors."

Etisalat added just shy of one per cent, but the rest of the blue-chips struggled.

The top three lenders all fell, with National Bank of Abu Dhabi dropping 1.89 per cent, while First Gulf Bank and Abu Dhabi Commercial Bank lost 3.3 and 1.5 per cent respectively.

Real estate was in similar strife. Aldar Properties fell by 1.2 per cent and Sorouh Real Estate by 2.4 per cent as investors cashed in some of the latter's recent gains.

"The only activity seems to be coming from day traders and speculators as both markets hover around key resistance points," said Khalek.

"With these players in the ascendancy, it's impossible for the market to build any momentum, with traders booking profits wherever they can, as we have seen in Aldar and Sorouh recently."

Aldar and Sorouh were top traders, with the latter seeing Dh86m of shares change hands, while the former claimed a turnover of Dh30 million. ADX trading was worth Dh210m yesterday, the second best total of 2009.

"As the results come out, we may see investors slowly starting to build positions, but for now they will wait on the sidelines," said Julian Bruce, EFG-Hermes director of institutional equity sales.

"There shouldn't be any significant recovery in the first quarter, but it's difficult to predict because we haven't received positive news from any companies or any suggestions that earnings will be kept on track."

ADX stocks resilient 

Abu Dhabi stocks are proving resilient thanks to the capital's greater cash resources and the lesser influence of speculators, analysts say.

"The overall consensus is that Abu Dhabi is more secure because is has a considerably larger bank of assets, including foreign reserves, so the ADX has not suffered as aggressive a sell off," said

Julian Bruce, EFG-Hermes director of institutional equity sales.

"Investors greatly favour the capital's real estate sector."

DP world rises 

DP World climbed 2.94 per cent to $0.36 after seeing 2.8 million shares change hands. No other Nasdaq Dubai stocks were active.