Dh27 billion wiped off share values


More than Dh27 billion has been wiped off the value of Dubai shares so far this month after heavy selling by foreign investors amid the turmoil on global financial markets.

The Dubai Financial Market (DFM) index has dropped 400 points since the beginning of March. The index opened the month at 5,958 points and closed yesterday’s session at the 5,547-mark, registering a loss of 6.8 per cent of its value since March 2.

Analysts said the decline reflected the high aggregate sales of foreign investors during the month due to continuing fluctuations and uncertainty in international markets driven by the US sub-prime mortgage crisis.

Mohamad Al Beheiri, head of trading at Amana Financial Services, said statistics of trading by foreign investors, both institutional and individual, on the Dubai Financial Market during the first week of this month showed that foreigners were net sellers of shares to the tune of Dh458 million.

The second week showed that individual foreign investors bought Dh1.992bn of shares but sold Dh2.205bn, a drop of Dh213m.

Institutional investors were net sellers at Dh123m. Last week the value of shares bought by individual foreign investors reached Dh1.729bn while they sold Dh1.947bn, leaving Dh218m in net sales.

Institutional investors last week recorded Dh374m in aggregate sales.

“Taking into consideration that foreign trading represents around 35 per cent of the total daily turnover on the Dubai Financial Market, we see trading by foreign investors had double the impact on the stock market.”