By: Thabet Shehata
Dubai – Mubasher: The Dubai Financial Market (DFM) registered its sharpest monthly decline in 2015 in August due to a negative atmosphere following global economic volatility, which was reflected on UAE markets at the end of the month.
The DFMGI tumbled 11.6% or 480.65 points to 3,662.56 points, compared to its July closing of 4,143.21 points. The general index closed in the red in 15 out of 22 sessions in August. However, it recorded its sharpest decline of 6.96% on 23 August.
On the other hand, the index ended only seven sessions in the green and recorded its highest gains of 4.6% on 25 August.
Fady El-Ghattis, CEO of Think Financial Studies, commented that UAE markets witnessed “exaggerated speculation” towards the end of August as speculators exploited the global negative atmosphere.
Negative developments in the global economy as well as the plunge in oil prices helped speculators control the markets, resulting in an “unjustified decline”, El-Ghattis told Mubasher.
All DFM sectors ended the month in the red, led by the services sector which nosedived 16.6% after Amanat Holdings and Tabreed plunged 18% and 13.5%, respectively. Meanwhile, the real estate sector dropped 13.46% after Arabtec and Emaar Properties slid 17.2% and 14.6%, respectively.
The negative financials of several large companies in the real estate sector contributed additional pressure to the sector’s stocks; therefore, deepening the losses, El-Ghattis noted.
The banking sector was down 8.74% after all its stocks retreated, led by Dubai Islamic Bank (DIB) and Emirates NBD, which dropped 6.67% and 15.8%, respectively.
The investment sector witnessed a sharp decline of 15.4% during the month as Dubai Investments (DI) and DFM Company shed 15.8% and 10.88%, respectively. The telecom sector registered the lowest decline of 5.2% as du retreated similarly to AED 5.100, compared to its July closing of AED 5.380.
The DFM’s August losses were accompanied by increased liquidity, reaching an average of AED 577.6 million per session compared to AED 491 million per session in July, registering growth of 17.6% month-on-month. Meanwhile, average traded volume rose 9.3% to 351.7 million shares compared to 321.7 million in July.
Translated by: Nada Adel Sobhi
