Dubai hits three-week low; Air Arabia weighs

UAE, Qatar are up for review in June by index compiler MSCI for an upgrade to emerging market status
Dubai hits three-week low; Air Arabia weighs
EARNINGS REPORT: Zains profit rose 36 percent while Air Arabia saw a 14.6 percent drop in profits (Getty Images)
By Reuters
Thu 05 May 2011 11:35 AM

UAE markets fall on selling pressure as investors are reluctant to pump in new funds amid rising doubts on MSCI inclusion and Air Arabia weighs after first-quarter results miss forecasts.

The low cost airline fell 1.8 percent. It earned a net profit of AED42.7m ($11.6m) while five analysts forecasted an average net profit of AED49.6m ($13.5m)in a Reuters survey in April.

Dubai's index slipped to a three-week low, down 0.6 percent to 1,609 points.

With no gainers on the index, Arabtec and Emaar Properties shed 0.7 and 0.6 percent in heavy trade.

"There isn't a lot of consensus on the direction of the market, that's why there is volatility," says Marwan Shurrab, vice president and chief trader at Gulfmena Alternative Investments.

"MSCI announcement is the main reason why the market is seeing interest from local investors. They are looking to benefit from the re-balancing," he adds.

UAE and Qatar, both frontier markets are up for a second review in June by index compiler MSCI for an upgrade to emerging market status. Abu Dhabi's heavy interest stocks Dana Gas and Aldar Properties fell 1.5 and 2.5 percent. Trading is concentrating in these stocks, weighing on the index. The benchmark slipped 0.1 percent to 2,696 points.

Elsewhere, Qatar's index slid 0.04 percent to 8,490 points, almost flat as trading is thin.

"The market faces stiff resistance at 8850 points and the short-term trend is turning flat, so there is a chance we see a small pullback or range-bound trading between 8400-8700 points before the market gathers enough steam to push higher," says Sleiman Aboulhosn, assistant fund manager at Al Masah Capital.

Qatar Telecommunications shed 1.7 percent.

For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.