The real estate sector is the biggest supporter of the Gulf market

Amlak-Agencies
The GCC real estate sector is the largest supporter of the GCC market in general, as the strong results of the UAE banks boosted the gains achieved by the UAE markets, which was reflected in a remarkable positive growth in their trading during January 2014, so that this positive state of performance was reflected by the rise of the Dubai market index by 11.8 % and the Abu Dhabi Financial Market index 8.9 % by the end of the month.

The real estate sector is the largest supporter of the GCC market in general.

GCC bourses
Bourse experts said in separate interviews that the fluctuations witnessed by the GCC bourses at the end of last month were not without the Dubai and Abu Dhabi markets, but the strong results of the banking sector, most of which were announced at the end of the month, played a positive role in supporting the indices and raising the values of stocks with high weights in the two indices, offsetting the full impact of these fluctuations.

During the whole of last month, the Dubai Financial Market witnessed the trading of 22.8 billion shares, with a total value of about 36.45 billion dirhams, which financial analysts considered that it strongly indicates that investors benefit from the strong recovery climate in Dubai, and reflects a strong start to a new year that will be supported by continuous rises, especially after achieving strong rises in shares of companies in the financial sectors, including banks and real estate, which formed the basis for the recovery of the stock market.
Banking sector
Some analysts pointed out the importance of the positive impact of the results of the banking sector, whose index rose during the past month, by 11.63%, and the most prominent gainers were Dubai Islamic Bank, which rose by 10.8% during the entire month, and Emirates NBD, which achieved a strong rise of 13.38%.

At the end of last month, the DFM issued the Securities Lending and Borrowing Rules, which allowed lenders and borrowers to arrange lending operations on the basis of international markets, provided they direct local authorized lending and borrowing agents to carry out the transfer of securities.
“The DFM's implementation of several initiatives to enhance its infrastructure is welcomed by local and foreign investors,” said Maryam Fikri, Executive Vice President of Operations and Head of Clearing, Settlement and Depository at DFM, explaining that the initiatives to enhance financial market tools “played a vital role in the classification of the UAE's stock market as an emerging market by MSCI and S&P Dow Jones Indices.“



Real estate

For his part, financial analyst Walid Abdul Haq said that the Dubai Financial Market was able to benefit from the state of economic recovery in the real estate, services and financial services sectors, so that this recovery was a strong motive that enhanced the positive performance, which was represented by ending last month with a strong rise that raises the degree of confidence among investors in more rises, especially since it is the first month of the year and analysts usually take a measure of the psychology of traders and the reaction they have formed to the results of the companies” business for the past year.

He added that the real estate sector remained the biggest supporter of the Dubai Financial Market, through strong rises that reflected the amount of profits expected to be achieved by real estate companies amid the significant growth expected for this sector due to the huge projects aimed at preparing for Dubai's hosting of the World Expo 2020. Abdulhak stated that the significant increases in the real estate sector reflect a real demand this time, different from the exaggerations witnessed by the sector in previous years, through a real growth in demand justified by the increase in the injection of liquidity heading to Dubai as a result of the state of stability and high confidence, compared to the crises witnessed by the Middle East region, which made the compass of investors heading towards Dubai.

As for the performance of the Abu Dhabi Financial Market, which ended last month, up 8.92% supported by real estate and banking stocks, financial analysts expected the positive results of the banking sector to drive the positive performance of the market during the next three months.
Real Estate Sector Index
Fawaz Al Person, analyst at Etihad Financial Brokerage, said that the rise in the real estate sector index 21.38% over the course of the month's trading in the Abu Dhabi market had the greatest impact on raising the general index, and gave a strong signal of positive performance despite investors' concerns about exaggerating the recovery in the real estate sector.

The person warned against exaggeration or over-optimism about the continuation of the rise in the real estate sector, which has achieved great qualitative leaps, reflecting real activity that cannot be underestimated, but the rises in stocks should be on a measured basis that reflects expectations closer to reality.
He said that the announcement that the Abu Dhabi government would allow foreigners to own real estate in the emirate had a major impact on achieving unprecedented jumps in the shares of real estate companies and their expected performance. According to data from the Abu Dhabi Financial Market, Aldar Properties rose by 21.7%, in the context of positive expectations for the company's performance during the current year.
For his part, banking expert Shaheen Al Ali said that the Abu Dhabi market benefited primarily from the performance of the real estate sector, followed by the banking sector, which achieved remarkable positive growth so that the banking sector index increased by 9.4%, stressing that this growth reflects the strong performance and positive budgets of listed banks.
He pointed to the rise in the shares of First Gulf Bank, by 6.38%, which constitutes the largest market value and the largest relative weight within the Abu Dhabi Market Index, through the announced results, which positively exceeded the expectations of financial analysts.

First Gulf Bank, which represents the largest market value and the largest relative weight within the Abu Dhabi Market Index.