Profit taking haunted the Dubai stock exchange yesterday, dashing hopes of it rebounding for a second day.

The Dubai Financial Market (DFM) fell 1.11 per cent to 5,018 points, its second-lowest finish of 2008, and diminishing volumes bode ill for Sunday.

Trading slumped to Dh890 million, which is 39 per cent down on Wednesday's total, indicating that investors are not yet convinced that the market will recover in the near term.

"Yesterday's profit taking by domestic investors was expected after Wednesday's fairly healthy rebound," said Julian Bruce, EFG-Hermes director of institutional equity sales.

"This selling caused some downward pressure at the end of the session, but everyone seems quite relaxed, so hopefully we will see some consolidation around these levels before the market can move up again."

Losers dwarfed gainers 22:4, with only Emirates NBD, going up 2.17 per cent, and Dubai's newest recruit Takaful House advancing on decent volumes. The latter edged up 0.74 per cent.

DFM Company was the most conspicuous loser, plunging 4.11 per cent to Dh3.96, while Emaar also fell, this time slipping 1.82 per cent to Dh9.66, its second worst close in the past 12 months. Bruce said: "Emaar fell below Dh10 on a technical breakdown and this mark has now become a resistance level.

"Institutions should be interested because the stock is cheap, but it doesn't have any major potential upside in the short term," said the institutional equity sales director.

Emaar, DFM Company and Dubai Islamic Bank (DIB) are seen as proxies for the overall market and, with DIB slipping 1.05 per cent, sentiment appears shaky.

Property-related stocks were again battered. Mortgage providers Amlak Finance and Tamweel lost 4.77 and 5.7 per cent respectively. The property financier Amlak closed on Dh3.99, which is only the second time this year it has slipped below Dh3.99 – the other was on Tuesday.

Meanwhile, Tamweel was hammered in the final hour's trading at the DFM after its former chief executive was arrested for alleged embezzlement.

This week's performance follows a familiar pattern, with Tuesday and Thursday seeing selling pressure to push the market lower because of margin calls, first by brokers and then by the brokerage arms of banks.

Bruce added: "In the absence of any news the stock markets will see a mild downward trend, without aggressive selling. The current low liquidity it's difficult for the market to push upwards."



DP world gains

DP World made gains for the third session in six, climbing 2.53 per cent to $0.81.

Its latest advance in the market came despite slumping volumes with just 2.36 million shares changing hands in 76 trades.

The ports operator was the only stock to advance on the Dubai International Finance Exchange as Depa declined and Damas closed unchanged on $0.99.

Depa dropped four per cent to $1.20, which is an all time low.



ADX marches ahead

Unlike Dubai, the Abu Dhabi Securities Exchange built on Wednesday's gains to climb a further 1.6 per cent to 4,534 points. All sectors closed in the green, but real estate was the standout performer as Aldar Properties surged 3.68 per cent, while Sorouh Real Estate added 4.84 per cent.

"In Abu Dhabi there was a flow of foreign investors picking up real estate and banking stocks, but there was less foreign interest in Dubai," said Julian Bruce, EFG-Hermes director of institutional equity sales.

This column has detailed the decline of the capital's 10 largest stocks in recent weeks, but this elite group prospered yesterday with National Bank of Abu Dhabi and Arkan the only members to decline yesterday.

Etisalat was up 1.37 per cent and First Gulf Bank added 5.32 per cent.

ADX turnover topped Dh1 billion for the first time since July 24 as Dh1.15bn of shares changed hands.

Aldar claimed Dh433 million of this total, a sure indication that foreign and local funds are buying back the stock. It closed on Dh10.20, which is at 23 per cent discount on June's all-time high of Dh13.30. Currently, 37.8 per cent of Aldar's shares are in foreign hands, which is shy of the 40 per cent maximum and so heavy volumes are expected next week.

"On Wednesday, a big seller was offloading Aldar, but as this supply falls, demand should push Aldar up. Both markets will start to behave similarly as investors switch between the two."