By: Mahmoud Gamal
Dubai – Mubasher: UAE stock markets are forecast to see some sideways-to-declining movement this week as investors remain on the lookout for their companies’ upcoming financial disclosures, particularly those in the real estate and banking sectors, analysts told Mubasher.
Last week, the Dubai Financial Market (DFM) retreated on the back of selling pressure on the real estate and banks stocks, while the Abu Dhabi Securities Exchange (ADX) also ended on a low note after the dissatisfactory results of First Abu Dhabi Bank (FAB).
Market analyst Amin El-Hennawy said he expects the bourses’ movement this week to remain the same as the week before, after the two stock markets closed in the red, after three straight gains.
The DFM is forecast to continue its sideways movement along with possible declines as the market nears “strong technical levels” which require a seller more than a buyer, the analyst told Mubasher.
El Hennawy further attributed the DFM’s losses last week to companies’ results, some of which recorded profit declines, noting that there were technical factors that contributed to the DFM’s decline, including facing the strong resistance level of 3,680 points.
Breaking 3,680 points “correctly” will prompt the DFM’s benchmark index towards new gains, the analyst told Mubasher, highlighting that in order to break this level, the market will require several helping factors including high turnover.
IPOs
The recent announcements made by Emaar Properties and ADNOC regarding initial public offerings (IPOs) has also prompted several investors to hold on to their money and refrain from entering the market now until the new IPOs come to light, El Hennawy added in a comment to Mubasher.
Thursday, 2 November marks Emaar Development’s IPO, a subsidiary of Emaar Properties, on the DFM, which will include 800 million shares.
The retail investor tranche will begin on 2 November and end 13 November, while institutional investors will be able to bid between 2 November and 15 November.
The forecasted declining trend may change course in the event of the emergence of unexpected positive results, particularly in the real estate sector, the analyst stressed.
Meanwhile, analyst Razan Shahwan said that the UAE bourses’ movement this week was going to be strongly tied to companies’ financial results.
Positive results will boost the market above 3,651 points, which the market reached last week on the back of Emaar Properties’ stock, the analyst told Mubasher.
This week, investors will be awaiting the results of Emirates NBD, Emirates Investment Bank for the third quarter of 2017.
Translated by: Nada Adel Sobhi
