The Dubai Financial Market (DFM) benchmark General Index dropped by 2.5 per cent to 4,972 points.
UAE stocks on Sunday recorded bearish activity led by property stocks on the UAE Central Bank warning on the country's property market.
The Dubai Financial Market (DFM) benchmark General Index dropped by 2.5 per cent to 4,972 points. All property stocks at the Dubai bourse closed in negative territory led by the biggest listed building contractor Arabtec Holding, which tumbled by 6.7 per cent, followed by Drake & Scull five per cent down, Deyaar Development dropped by 2.96 per cent, Union Properties fell by 2.54 per cent and property giant Emaar Properties lost nearly two per cent. Emaar share price recorded more than 40 per cent appreciation in 2014.
In Abu Dhabi, the ADX benchmark Index also declined by 1.14 per cent to 4,997.86 points, led by property stocks. Aldar Properties, trading volume leader of the day, decreased by 2.55 per cent with 197 million shares transactions. Eshraq Properties, second in terms of trading volume, also tumbled by 3.33 per cent.
The detailed central bank report said that average rental yields in Abu Dhabi and Dubai had fallen below historical averages as property prices rose, indicating that the market may be overheating.
"The central bank report could be a catalyst for profit taking, but the main driver is that valuations are on the generous side, and fundamentals need to catch up. "As a result the market is susceptible to short term volatility or negative news," Yaser Abushaban, executive director of asset management at Emirates Investment Bank, told Bloomberg.
At DFM, real estate index dropped by 3.38 per cent or 439 points. The Dubai bourse recorded total 10,302 trades. Its trading volume touched nearly 540 million shares worth Dh1.58 billion. Arabtec was volume leader with 121 million shares transactions, followed by Union Properties 90 million shares, and Drake & Scull 70 million shares.
While ADX real estate index fell by 2.6 per cent. Total trades crossed 2,810 mark. Trading volume of 144 million recorded, valuing Dh412 million.