The UAE's bourses closed higher yesterday with investors shifting their focus from stocks with small market capitalisation to mid and large-cap stocks, driven by speculation of an upgrade by the index benchmarker MSCI.
"Retail investors have made the switch from small cap to large caps," said Julian Bruce, the head of equity sales at EFG-Hermes in Dubai.
"If you are going to play the MSCI inclusion story, there is no point in buying small caps with marginal index weighting, which is why they are concentrating on the heavyweight companies."
The UAE is a candidate to be upgraded to an emerging market by MSCI.
The review, expected in June, could upgrade the country's status from frontier market.
The Abu Dhabi Securities Exchange General Index was up 1 per cent at 2,659.32 points. Aldar Properties was up 3.2 per cent to Dh1.60 and Dana Gas gained 1.5 per cent to 66 fils a share.
On the Dubai Financial Market, Arabtec Holding was up 0.6 per cent to Dh1.51, while Emaar Properties was up 1.8 per cent to Dh3.32.
Elsewhere in the region: Kuwait's index was unchanged at 6,369; Bahrain's measure lost 0.5 per cent to 1,401.95; Oman's benchmark was flat at 6375.04; and Qatar's index gained 0.5 per cent to 8,815.43.
The Saudi Tadawul All-Share Index rose 0.2 per cent to 6,604.16.
