The Abu Dhabi Securities Exchange is tipped to outperform its Dubai rival for the rest of this month.
That is the view of Amjad Bakir, Mac Sharaf Securities trading manager, who believes the imminent launch of derivatives on the capital's bourse will give it the edge over Dubai.
"The ADX is stronger than Dubai. Derivatives will allow investors to do short-selling and buying, which will give a big boost to liquidity and volatility," said Bakir. "So the ADX looks a better prospect than Dubai, unless of course the latter follows suit."
Bakir's views are contrary to some analysts who predict the ADX is running out of steam following an excellent start to 2008, which has seen it gaining 10.6 per cent this year. Dubai has struggled in comparison, losing 1.72 per cent in 2008. Some brokers believe investors will shift their attention to Dubai until it catches up with the ADX and from there both markets will move simultaneously.
Dubai has been more active this month, with average traded volumes and value of 492 million and Dh1.65 billion respectively, while for Abu Dhabi these figures are 247 million and Dh1.1bn.
Last week, both markets were range-bound, with the ADX adding 0.2 per cent, while the Dubai Financial Market fared slightly better, putting on 0.25 per cent. This was disappointing for most investors, who had hoped the new month will see the rally resume, but the anticipated improved volumes failed to materialise.
"If Dubai can close above 5,850 this week, things will be promising," said Bakir.
"With sideways movement, it's fine for turnover to be between Dh700m-Dh1bn as investors make accumulations, but to move up significantly trading will have to improve. I think Dubai can reach 6,100 before May-end, but June will be quiet."
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