Wednesday / June 26.
HomeMarketsDFM makes strongest gains since 2007

DFM makes strongest gains since 2007

dfm interiorDubai shares gained the most in almost seven years in July, helping claw back some of the losses sustained in a bear market that wiped a quarter off the benchmark index.

Real estate-related companies led the rally. Arabtec Holding Co. (ARTC), which spurred the DFM General Index’s collapse in May and June, advanced 4.9 percent today to bring monthly gains to 63 percent. Emaar Properties PJSC, the company with the biggest weighting on the gauge, added 0.7 percent. Union Properties PJSC climbed 4.4 percent.

Dubai’s measure gained 2 percent to 4,833.24, bringing the monthly advance to 23 percent, the strongest since October 2007, according to data compiled by Bloomberg. Nine of the regularly traded stocks in the 30-member index traded above their 50-day moving average price through yesterday, up from zero at the start of July.

“After aggressive dips you see aggressive rebounds,” Ahmed Shehada, head of advisory and institutions at NBAD Securities LLC, the United Arab Emirates’ fourth-biggest brokerage by trading volume, said by telephone. “When the index dipped below 4,000, investors saw value across the board. A lot of institutions have been buying in.”

Dubai’s share gauge entered a bear market June 23 after warnings from the U.A.E.’s central bank that the country’s property market may be overheating. Management and shareholder changes at Arabtec stoked investor concern the nation’s biggest listed construction company was losing government support, fueling declines. Arabtec shares retreated 61 percent in June.

“That side-tracked investors from the fundamentals,” Shehada said. “First-half earnings reports across the board are looking strong.”

Union Properties advanced to 2.16 dirhams after it said July 24 first-half profit surged to 707 million dirhams ($192 million) from 135 million dirhams in the same period a year earlier. Emaar (EMAAR) rose to 9.77 dirhams. The developer of the world’s tallest tower will report second-quarter net income of 936 million dirhams, up from 675 million dirhams a year earlier, according to the median estimate of four analysts surveyed by Bloomberg.

Arabtec climbed to 4.25 dirhams. The company said July 27 profit for the second quarter climbed 11 percent to 103 million dirhams.-Bloomberg