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Mon 25 Jan 2010 10:37 AM

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Dubai index makes largest gain for three weeks

UPDATE 7: Emaar shares climb 5.7%, Arabtec up 4.2% and DFM rises 7.6%.

Dubai's index made its largest gain for three weeks, claiming back some of Sunday's losses as most stocks rebounded.Emaar Properties climbed 5.7 percent, Arabtec added 4.2 percent and Dubai Financial Market rose 7.6 percent. This trio continued to dominate trading, accounting for two-thirds of all shares changing hands on the index, which climbed 2.8 percent to 1,614 points.

Union Properties rose 1.7 percent to 0.60 dirhams, with investors unmoved by Credit Suisse cutting its price target for the developer to 0.03 dirhams from 0.80 dirhams, giving the stock an underperform rating.

"Even if the company was able to overcome its current liquidity squeeze....there wouldn't be equity value left after meeting all debt obligations," Credit Suisse wrote.

Drake & Scull and Aramex climbed 2.5 and 3.4 percent respectively.

"There was a drop in foreign ownership in some stocks such as Arabtec yesterday, but rose in Aramex and Drake & Scull," said Ali Khan, managing director and head of brokerage at Arqaam Capital.

"Aramex continues to see rising levels of foreign ownership -- 2009 was about the company cutting costs and it executed this strategy superbly in the first three quarters and there's no reason why it will not at least match, if not beat, full year consensus forecasts. We remain pretty bullish on the stock."

Saudi Basic Industries Corp (SABIC) lifted Saudi Arabia's index as steady oil prices bolstered sentiment.

SABIC rose 0.6 percent, while other bluechips also prospered, with Kingdom Holding rising 2.8 percent and SABB adding 1.1 percent.

The index rose 0.2 percent to 6,316 points.

Oil edged up 0.2 percent to $74.65 a barrel. It is down 10.3 percent since its 15-month closing high on Jan 6.

Abu Dhabi's index ended higher for a first session in five, although volumes declined by a third from the day before, with investors remaining cautious ahead of corporate earnings.

Four stocks account for three-quarters of all shares traded on the benchmark. Of these, Aldar Properties was the biggest gainer, rising 3.4 percent, while Sorouh Real Estate added 2.2 percent and RAK Properties and Dana Gas climbed 2 percent and 1.1 percent respectively.

The index climbed 0.3 percent to 2,608 points, rebounding from a six-week intraday low.

Property stocks rallied, helping Qatar's index end higher for a first session in four as regional sentiment became more positive following sharp declines the day before.

Barwa Real Estate climbed 3.7 percent, trimming its losses to 16 percent since agreeing terms to merge with Qatar Real Estate (Alaqaria) on January 10.

Alaqaria rose 4.3 percent. It was up 4 percent since the merger was announced, but had fallen for the past six sessions. Under the terms of the agreement, each Alaqaria share will be exchanged for 1.1 Barwa shares.

This pair accounted for almost a third of all shares changing hands on the index, which rose 0.7 percent to 6,710 points.

Heavyweight banks helped lift Kuwait's index to a month high as stocks recouped the previous day's losses.

Kuwait Finance House climbed 1.9 percent and Commercial Bank of Kuwait rose 3.2 percent.

Kuwait' benchmark rose 0.9 percent to 7,084 points, its highest finish since December 27 and biggest one-day gain for three weeks.

Bahrain's measure also advanced, climbing 0.2 percent to 1,474 points.

Oman's index ended higher for the first session in four, despite five of its eight largest stocks ending lower as the benchmark tracked rebounding regional markets following a sell-off the day before.

Oman Telecommunications Co (Omantel) rose 0.2 percent and Bank Muscat climbed 0.4 percent, but National Bank of Oman, Raysut Cement and bank Sohar were among the bigger names to decline in a mixed performance, with trading focused on the small-cap speculative stocks.

The index climbed 0.6 percent to 6,406 points. (Reuters)

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