Market Wrap: Bullish earnings estimates and Dubai's ambitious expansion plans for its main airport gave a push to construction stocks.
Construction stocks take off on UAE markets
Bullish estimates on earnings and Dubai's ambitious expansion plans for its main airport gave impetus to construction stocks yesterday.
The Dubai Financial Market (DFM) General Index rose 0.3 per cent to 1,557.85 and Abu Dhabi's measure fell 0.08 per cent to 2,714.77.
Construction stocks were among the most actively traded on both markets. On the DFM, Drake & Scull International rose 1.84 per cent to 99.8 fils and Arabtec gained 2.27 per cent to Dh1.35.
But analysts did not expect the potential profits from the US$7.8 billion airport expansion to materialise in the companies' earnings for some time, said Akram Annous, a Middle East and North Africa strategist at Al Mal Capital.
"People may be thinking they'll get some of this business, but it's nothing near-term," he said.
Investor enthusiasm for construction companies as a result of the airport expansion was being tempered by speculation over earnings statements, said Talal Touqan, the head of equity research at Al Ramz Securities.
"It will by all means reflect positively on all these in the long run, but nowadays, traders are just busy speculating over results," he said.
Abu Dhabi property stocks also got a boost, with Sorouh Real Estate rising 0.79 per cent to Dh1.28, while Aldar Properties rose 1.56 per cent to Dh1.30.
Companies elsewhere in the Gulf were starting to see movement from the release of second-quarter earnings, starting with Qatar.
On Wednesday, Qatar National Bank posted a 25.8 per cent rise in second-quarter net profit to 1.8bn rials. The bank fell 0.9 per cent to 143.3 rials yesterday.
The Abu Dhabi Securities Exchange was the only market in the Gulf to close lower.