Markets Update: Sorough Real Estate and Aldar Properties fell this morning, bringing to an end the companies' week long rise following their announcement they are looking at a merger deal.
Sorouh and Aldar sink ending week long rise on Abu Dhabi's bourse
Aldar lost 3.45 per cent to Dh1.4.Sorouh dropped 2.76 per cent to Dh1.41 a share.
This morning Aldar released a corporate governance report, which said it would be setting up a special committee to look into the possible merger with Sorouh. However investors’ negative reaction to the report suggests they had been expecting more detail about the deal from company.
The drag from the two property companies weighed on the Abu Dhabi Securities Market General Index, which was down 0.54 per cent to 2,629.57 in early trading. The fall in Abu Dhabi also hit stocks in its neighbour, taking the Dubai Financial Market General Index down 0.79 per cent to 1,677.66.
However the expectation of higher oil prices continues to support local bourses. Shares in Taqa, the Abu Dhabi National Energy Company, rose 2.27 per cent to Dh1.35 in early trading. Dana Gas stock started the session higher by 2 per cent to Dh0.51 a share.
Dubai crude is rising from four month lows to close in on the price of Brent, amid continued fears over supply and the expectation of increased demand.
The difference between the Brent Futures contract and Dubai Forward Swaps contract – the Brent price premium to Dubai crude – has fallen 2.94 per cent to $3.30 a barrel, compared with $4.56 on March 1, according to data from London-based broker PVM Oil Associates
Goldman Sachs said last night it expects the global oil market’s fundamentals “will continue to tighten”, Bloomberg reports.