Volume hits 7-month high on DFM

Dubai Financial Market (DFM) rebounded on Monday with the volume of shares traded reaching seven-month high on the back of strong investors' sentiments.

Volume of shares touched 448.2 million, its highest since March 29.

Overall, DFM opened and closed with a bullish tone on Monday with all sectors trading strong. The benchmark index closed at 1,781.92, up 17.38 points or 0.99 per cent.

Stocks of utilities sector inched up the highest at 12.38 per cent, followed by transportation (up 1.58 per cent), financial/investment sector (up 1.46 per cent), among others.

Stocks that pushed the market up were Emaar Properties, Ekttitab Holding, Al-Madina for Finance & Investment, Tabreed, Deyaar Development, Global Investment House, Hits Telecom, Arabtec, Aramex, Drake and Scull International, Union Properties, among others.

Both domestic and international catalysts helped the market's movement upwards on Monday, analysts say.

Good performance of many Asia-Pacific markets was one of the catalysts.

“Strong statistics on Chinese manufacturing helped the markets to move up in the Far East and the trend continued in the Middle East also. Secondly, as the Federal Open Market Committee in the US is going to meet in a couple of days, expectations of quantitative easing are also very high among investors," said Krishnamurthy, CEO of the brokerage firm Dubai International Securities.

Back home, profitable financial results announced by a number of companies seemed to have boosted investors' sentiments too. For instance, Emirates reported first half profit of Dh3.4 billion ($925m), a 351.2 per cent increase over the profit of Dh752m for the corresponding period last year. That is four-and-a-half times last year's half-yearly results.

Further, Mashreq bank announced a net profit of Dh647.4m for the nine-month period. Total provisions set aside by the bank for the nine months also dropped to Dh1.21bn, down 12.3 per cent compared to Dh1.38bn in the same period last year, the bank said in a statement posted on DFM website.

The bank's capital adequacy ratio (CAR) at the end of September under Basel II guidelines improved to 22.3 per cent as compared to 20.18 per cent at the end of 2009, the statement said.

However, Krishnamurthy added: "Going forward, in the absence of any major fundamental macroeconomic change and because global uncertainties continue to remain, selling pressure will now and then keep impacting the market whenever there's short rally happening."

Abu Dhabi Securities Exchange (ADX) closed down by 12.69 points.