ADX moves sideways on heated buying of Aabar
The Abu Dhabi Securities Exchange continued to move sideways yesterday and closed almost flat amid trading that was generally calm apart from the expected heated speculative buying of Aabar Investments.
The general index advanced slightly by 5.68 points, or 0.2 per cent, and closed at 2,781.18 with leading stocks moving in a very narrow range. Turnover remained low with 76 million shares worth Dh174.2 million changing hands.
Aabar was the most active stock, accounting for around 40 per cent of the total turnover. The stock advanced 4.56 per cent to close at Dh2.52 after it attracted strong speculation and buying interest after the company announced the proposal to acquire a 70 per cent stake in Arabtec at a considerable discount.
"Investors believe the deal will benefit Aabar in both the short and long term," said Fadi Al Said, Head of Mena Equities at ING Investment. "Aabar is buying Arabtec's shares at a discount compared with the current market price. This means that Aabar will achieve immediate profits when the bonds are converted into shares."
Despite the interest in Aabar, other leading stocks in the real estate and energy sectors remained almost flat. Sorouh and Rakprop closed flat at Dh2.83 and Dh0.59 respectively while Aldar retreated by 1.35 per cent to Dh5.09. Dana Gas and Taqa advanced slightly to Dh1.02 and Dh1.20 respectively. Heavyweight etisalat moved up and closed at Dh11.10 while bank stocks closed flat or moved in a very narrow range.
Ehab Rashad, Trading Manager Direct Broker for Financial Services, said: "The ADX is moving sideways in calm trading. The turnover is low and this is giving indicators for a downside tendency in the future. The market is facing resistance at 2,900 points, which is far above the current levels."
Dana to discuss plan
Dana Gas added one per cent to close at Dh1.02 yesterday amid calm trading. The company announced that its board of directors would meet on Wednesday to discuss its business plan for 2010-2012 as well as the financing of the company's projects.
The agenda also includes Dana's objectives for 2010 and its business development report.
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