The start of the earning season for banks failed to give the spark to local markets some had hoped for as the week drew to a close, with many lenders languishing after First Gulf Bank reported earnings yesterday.
The Dubai Financial Market General Index fell 0.3 per cent to 1,547.86, while Abu Dhabi's measure rose 0.3 per cent to 2,725.25.
Dubai's market was encountering resistance around the 1,555.00 mark following a 1.35 per cent rise on Wednesday, analysts said.
"Yesterday's uptick move was indeed beyond expectations, and now [traders are] getting back to reality," said Talal Touqan, the head of research at AlRamz Securities.
Banks saw few sharp movements after First Gulf Bank (FGB) reported an increase in profits of 13 per cent to Dh890 million after markets closed yesterday.
The bank maintained its margins, but income from fees was sharply down as new Central Bank regulations to combat excessive personal lending charges took effect, leaving analysts to warn of a tricky year ahead.
The stock was unmoved at Dh17.75 despite beating analysts' estimates.
Instead, other lenders that are more active in business banking were benefiting from FGB's improved earnings, said Yazan Abdeen, a fund manager at ING Investment Management.
"We've seen the results of First Gulf Bank and it's comforting that there are no surprises in provisioning," he said.
In the absence of a sharp uptick in bad debts, many banks which are less active in retail lending have headed higher. Abu Dhabi Commercial Bank gained 1.23 per cent to Dh3.28 per share.
One of the biggest movers on the Dubai bourse was Tamweel, which fell 1.32 per cent to 90 fils a share after initially rising sharply. The Islamic lender announced plans yesterday to offer mortgages to international buyers as the UAE eases its restrictions on visas for property owners.