Dubai hits 5-month high on Vanguard move
Dubai, October 3, 2012
Dubai's bourse closed at its highest level for five months, while Abu Dhabi's index ended at a fresh 14-month high today.
The Dubai index jumped 1.2 percent to 1,623 points, its highest close since May 1.
The advance was aided by news that Vanguard Group, one of the largest mutual fund providers in the US, would switch to using FTSE Group from MSCI for benchmarking, opening up stocks in the UAE to their funds. While FTSE classifies the UAE as emerging market, MSCI ranks it as a frontier market.
"The timing remains uncertain but this type of event is always a catalyst for increased speculative activity," Julian Bruce, EFG Hermes' director of institutional equity sales, said.
Property stocks rebounded from Tuesday's dip, with heavyweight Emaar Properties up 2.5 percent, Union Properties rising 1.8 percent and Tamweel gaining 1.6 percent.
A large property convention, currently taking place in Dubai, was helping to fuel positive sentiment towards the real estate sector in the emirate, Bruce said.
"If you get names like Emaar, Arabtec, Deyaar and Drake and Scull moving then this creates a positive impact on the wider bourse."
Ajman Bank is the day's biggest mover, climbing 7.8 percent - the largest one-day gain in the stock in at least two years. Its volumes are also the highest since April 2011.
In Abu Dhabi, the measure gained 0.2 percent to 2,653 points, advancing further from the previous day's highest close since August 4, 2011.
The two property firms whose merger has driven positive sentiment on the bourse, Aldar Properties and Sorouh Real Estate, gained 1.5 and 0.8 percent, respectively.
Qatar's bourse dips for the first time in four sessions, ending the day down 0.4 percent at 8,504 points.
Only one of the 12 largest stocks by market capitalisation - Qatar International Islamic Bank - ended the day in positive territory. - Reuters