Stock markets in the United Arab Emirates and Qatar fall in sluggish trade, while Dubai builder Arabtec again declines.
Shares in Arabtec drop 3.2 per cent as investors question whether the company will stick to its ambitious expansion plans following the resignation of its chief executive and staff layoffs. The builder’s shares have fallen 59 per cent from May 14’s record close.
Dubai’s index drops 1.1 per cent to 4,178 points as other property stocks also decline.
Union Properties and Emaar Properties are down 1.6 and 0.9 per cent respectively and contractor Drake and Scull drops 3.8 per cent.
“The market is very slow, with very low trading volumes, which is expected (during Ramadan),” says Ali Adou, portfolio manager at The National Investor in Abu Dhabi.
Ramadan, the Muslim holy month of fasting, began on Sunday.
Abu Dhabi’s bourse slips 0.4 per cent to 4,645 points, although investment firm Waha Capital adds 0.8 per cent after announcing it was part of a consortium that has taken over Dubai’s National Petroleum Services.
Qatar’s index falls 2.2 per cent to 11,557 points. Islamic lender Masraf Al Rayan is the main drag, dropping 4.4 per cent.
“I think in Qatar the market is on a downward trend more or less for the same reasons (as in the UAE) – profit taking plus short-term invsetors getting out of the market,” says Shakeel Sarwar, head of asset management at Securities & Investment Co (SICO) in Bahrain.
Allegations of corruption in Qatar’s winning bid to host the 2022 soccer World Cup – which organisers strongly deny – have also hurt investor sentiment, he says.
“Foreign investors have been net sellers for the last few weeks,” Sarwar adds.