News Column

Muscat Securities Market index ends higher

June 23, 2014

Agencies



Muscat: The Muscat Securities Market Index yesterday  gained 18.77 points or 0.27 per cent to close at 6934.72 points.



The trading value yesterday stood at OMR29.58 million, comprising a rise of 616.13 per cent compared to the previous session, which stood at OMR4.13 million.



The report released by MSM pointed out that the market capitalisation rose by 1.71 per cent to reach about OMR14.85 billion.



The report added that the value of shares bought by non-Omani investors reached OMR3.76 million comprising while the value of shares sold by non-Omani investors reached OMR6.5 million comprising 22.00 per cent. The net non-Omani investment declined by 9.27 per cent to OMR2.744 million.



Dubai shares slump

Dubai shares slumped to the lowest in more than three months, led by property-related companies, after Arabtec Holding fired hundreds of employees, according to three people familiar with the matter.



The DFM General Index fell 4.3 per cent to 4,296, the lowest close since March 19 and a second day falling. Emaar Properties, the company with the largest weighting on the gauge, was the biggest decliner by index points, retreating 4.9 per cent. Arabtec tumbled 9.9 per cent after dismissing staff including senior managers, the people said, who asked not to be identified because the information is private.



"There is confusion in the market and I call it Arabtec fever," Wadah Al Taha, chief investment officer of Dubai-based Al Zarooni Group, said by telephone. "The sentiment is very weak, and investors weren't prepared for the situation getting so much worse." In a worst case scenario the index could fall to 3,800, he said.



Dubai's gauge entered a bear market after it plunged 20 per cent since a peak in May, according to data compiled by Bloomberg. Shares soared this year amid a real estate recovery in the emirate before the United Arab Emirates' central bank said June 8 there are signs the property market is overheating.



Two of the regularly traded stocks in the 30-member benchmark gauge were trading above their 50-day moving average price yesterday, according to data compiled by Bloomberg. That's the fewest since July 2012 and compares with a one-year peak of 23 in December.



Arabtec, which has the fifth-highest weighting on Dubai's index, has plunged 48 per cent this month. Abu Dhabi state-run Aabar Investments cut its stake to 18.85 per cent as of June 11 from 21.57 per cent, stoking speculation the builder was losing government backing. The company's shares plunged to Dh3.46, the lowest since March 17. Emaar, developer of the world's tallest tower, fell to Dh8.80.



Arabtec's Chief Executive Officer Hasan Ismaik resigned last week. Under Ismaik's 15-month leadership, Arabtec aimed to become a top-10 global contractor, expanding into areas including oil and gas and infrastructure. Shares in the largest listed construction company in the UAE gained 261 per cent this year to a peak on May 14.



"One stock, which had reached unacceptable levels, has been dragging down the rest of the index," Rami Sidani, who oversees the $343 millionSchroders International Selection Fund, said by phone from Dubai yesterday. "Arabtec has corrected by 50 percent and while correcting, due to the heavy participation of retail investors, it has put pressure on the rest of the market," he further added by phone.


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Source: Times of Oman


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