Markets Update: Gains for property companies help Dubai's markets fend off market turbulence on world stock indexes.
Property keeps index black in UAE
Property stocks rallied in Dubai, the only sector keeping markets in positive territory as renewed worries over the global economy weighed on local bourses yesterday.
The Dubai Financial Market General Index rose 0.3 per cent to 1,393.02 while the Abu Dhabi Securities Exchange General Index slid 0.3 per cent to 2,448.70.
Markets in Europe made tentative gains after a fall in Asian trading in the early hours of the morning, following a lukewarm response by Fitch Ratings to European leaders' "gradualist" approach to resolving the euro-zone debt crisis. The ratings agency also cut global growth estimates.
The Nikkei 225 fell 1.1 per cent to 8,552.81 and the Hang Seng index lost 0.6 per cent to 18,447.17. After European markets opened, the Euro Stoxx 50 index rose 0.3 per cent to 2,277.29. But despite a slide elsewhere in the Gulf, Dubai companies such as Emaar Properties, Arabtec and Drake & Scull International (DSI) all rose, keeping the emirate's index in positive territory.
DSI shares hit their highest level since September after the company announced a contract for work on a petrochemicals plant in Egypt. Shares in the construction company rose 2.1 per cent to 85.4 fils each.
The increased pipeline of new projects earned the company a "buy" recommendation from Arqaam Capital.
"We believe the market has generally assigned prudent valuations to contractors exposed to Arab Spring-related challenges," analysts said in a research note. But markets had "failed to distinguish on the basis of order book quality, and to adequately reward exposure to Saudi Arabia, Kuwait and Qatar," the report added.
Elsewhere in the Gulf, markets in Qatar, Saudi Arabia and Oman fell while the Bahraini bourse was flat.