Shares in several firms jump ahead of first quarter earnings reports while Dubai breaks through 5,000 points mark
Qatar's bourse hit an all-time closing high on Tuesday as shares in several companies jumped ahead of first-quarter earnings reports, while Dubai's bourse broke through resistance to close above 5,000 points for the first time since August 2008.
The Doha benchmark rose 1.3 percent to 12,940 points, surpassing the previous highest closing price of 12,893 points recorded in September 2005. It remained below the record intra-day high of 13,069 points reached on the same day in 2005.
Trading volume on Tuesday was the second highest since 2010, exceeded only by Monday's volume.
One of the key factors driving up prices has been the decision by index compiler MSCI to upgrade Qatar, along with the United Arab Emirates, to emerging market status, opening it to a larger pool of investors.
While the upgrade will take effect at the end of May, data shows that foreign funds have already invested heavily in some of the largest and most liquid companies that are most likely to be included in the MSCI emerging index.
On Tuesday, shares in two companies planning to publish their results in the next day or so were the main contributors to Qatar's rise: Al Khaliji Bank rose its daily limit of 10 percent and Nakilat added 8.6 percent.
Qatar Electricity and Water Co gained 1.9 percent after it reported a 49 percent rise in first-quarter net profit on Tuesday. The company earned 299 million riyals, while two analysts polled by Reuters had forecast 238.4 million and 286.7 million riyals.
Tuesday's move brought Qatar's gains this year to 24.7 percent, making it the second best performer in the Gulf and one of the fastest growing markets in the world. Dubai is up 48.9 percent.
Dubai's benchmark climbed 0.7 percent to 5,019 points on Tuesday, after gyrating around the 5,000-point mark during the day.
Dubai Islamic Bank and Emaar Properties were the main supports, climbing 4.3 and 1.4 percent respectively. After the close, Emaar reported a 55 percent rise in first-quarter net profit, in line with analysts' estimates.
On Wednesday, the firm will hold its annual shareholder meeting and some investors believe it could raise the 2013 dividend payout from the initially proposed 15 percent.
Shares in bourse operator Dubai Financial Market (DFM) , which planned to report its first-quarter results later on Tuesday, jumped 4.7 percent.
Not all stocks were buoyant though, with a number of other companies, including some in the property and construction sectors, closing in the red. The most heavily traded stock, property counter Deyaar, lost 2.9 percent.
"It's tough to accept as true that the market could bring in further gains after the strong rally, but bullish trends and breakouts to new highs can often go much further than our mind can imagine," Shiv Prakash, senior technical analyst at NBAD Securities, said in a note.
"The market needs to run a final blow-off rally before the bulls sell."
In neighbouring Abu Dhabi, the market index was nearly flat as both large- and small-cap stocks were mixed.
Abu Dhabi Islamic Bank rose 0.7 percent after its first-quarter profit, announced on Monday, grew 20.4 percent and met analysts' expectations.