DFM investors to focus on real estate, banks next week - Analysts

DFM investors to focus on real estate, banks next week - Analysts
Investor optimism is closely linked to blue chips
Drake & Scull DSI -0.58% 0.69 -0.00
Emaar EMAAR 0.00% 5.14 0.00

By: Mahmoud Gamal

Dubai – Mubasher: Analysts and economists forecast a number of factors that will continue to support the Dubai Financial Market’s (DFM) gains next week.

The most important factor currently governing the ongoing state of optimism is the highly anticipated financial disclosure period, analyst Waddah Al Taha, a member of the UAE National Advisory Board for the Chartered Institute for Securities & Investments (CISI) told Mubasher.

Emaar Properties & DSI

Investor optimism is closely linked to blue chips, particularly the DFM-listed Emaar Properties, whose profits are projected to rise by 12% to 15%.

Emaar last logged AED 1.7 billion in profits in the second quarter of 2017, up 23.2% from AED 1.4 billion in the year-ago period.

Investors are closely anticipating Emaar’s ordinary general meeting (OGM) which is set to be held on Sunday and will discuss turning Emaar Development into a public shareholder company, listing it on the DFM as well as offering 30% of its shares in an initial public offering (IPO).

The successful restructure of Drake & Scull International (DSI) and the acquisition by Tabarak Investments of a stake in the company helped boost the stock and subsequently the DFM over the week.

This week, the DFMGI grew 1.93% or 69.17 points to 3,660.27 points, its highest rise since mid-July, while DSI’s stock surged 9.35% this week on the back of the positive news of its restructure.

Results and challenges ahead

Meanwhile, UAE market analyst Amin El Hennawy forecast that the DFM’s continued rise next week is bound by a number of factors including positive results for the real estate and banking stocks.

The banks sector’s profits are likely to be good, especially after Dubai Islamic Bank (DIB) reported positive results for the first nine months of 2017, logging AED 3.3 billion in profits, an increase of 10% year-on-year.

These positive factors may boost the DFM’s turnover to reach AED 1 billion, however, the analyst told Mubasher that such a target was tough and may not be achieved.

Technically, the level of 3,680 points represents an important resistance level, which a break above it may prompt further gains; however, this resistance may be hard to break in the first place, according to the analyst.


Translated by: Nada Adel Sobhi

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Source: Mubasher Exclusive