By: Thabet Shehata
Dubai – Mubasher: Losses incurred on the Dubai Financial Market (DFM) in March played a major role in the overall negative result for the market in the first quarter of 2015.
The DFMGI plunged 259.6 points or 6.88% and closed at 3,514.4 points compared to 3,774 points by the end of 2014.
Meanwhile, on a month-on-month basis, the index plummeted 9% or 350.27 points compared to February’s closing at 3,864.67 points.
Fluctuating oil prices have negatively affected UAE stock market performance in addition to the absence of catalysts, Al-Awael Holding chairman Talal Al-Khoury told Mubasher.
He added that the financials of several large companies were not up to the standard, such as those of Arabtec on the DFM and Eshraq Properties on the Abu Dhabi Securities Exchange (ADX), which were reflected in the negative performance seen on the markets.
Liquidity was significantly low in March and Q1-15, reaching AED 38.66 billion in Q1, with a monthly average of AED 13 billion and AED 9.87 billion in March.
Meanwhile, traded volume reached 24 billion shares in Q1 with a monthly average of 8 billion shares and around 7 billion in March.
Market analyst Waddah Taha said that low market liquidity has made it easy for speculators to control the market, resulting in instability.
The holding seen on UAE markets was weak as it was not supported by strong turnover and often surrendered to selling pressures, the analyst told Mubasher.
The DFMGI’s real estate sector incurred losses reaching 12.16%, topping the declining sectors, as Arabtec nosedived by 22.2% and Emaar Properties fell 9%.
The investment sector ranked second and fell 7.4% as DFM Company plunged 25% in addition to negative performance by other stocks, with the exception of Dubai Investments which grew 0.84%.
The banking sector followed with a 4.8% decline as Dubai Islamic Bank slid 10% alongside other stocks, with the exception of Emirates NBD, which rose by 4%.
The telecom sector lost 2.78% as du retreated to AED 4.900.
Only three sectors ended Q1 in the green, headed by the consumer staples sector, which surged 11% amid positive performance on most of its stocks.
Translated by: Nada Adel Sobhi
