Dubai’s benchmark stock index advanced to the highest level in more than six months on investor speculation corporate earnings may beat analysts’ estimates, spurring bigger dividend payouts.
Emaar Properties PJSC (EMAAR), the builder of the world’s tallest skyscraper, climbed to the highest level since Aug. 4 before reporting fourth-quarter profit that beat analysts’ estimates. Deyaar Development PJSC (DEYAAR), a real-estate developer, jumped 7.3 percent. The DFM General Index (DFMGI) climbed 1.2 percent to 1,539.23, the highest since Aug. 4, at the 2 p.m. close in Dubai. In Abu Dhabi, Aldar Properties PJSC (ALDAR) rose after the company bailed out by the emirate recommended a cash dividend of 5 fils a share.
Aldar’s dividend plan helped boost investor sentiment for property developers in the United Arab Emirates, said Tariq Qaqish, deputy head of asset management at Dubai-based Al Mal Capital. “It was a big surprise for a company which was bailed out by Abu Dhabi government and suffered from serious negative cash flow to distribute cash dividends,” Qaqish said.
Emaar last year agreed to pay the first cash dividend since 2008, bowing to the demands of shareholders during a general assembly meeting. Today’s earnings statement didn’t mention a dividend plan. Emaar, the company with the biggest weighting on Dubai’s index, said after markets closed profit more than doubled to 716 million dirhams ($195 million). The average estimate of five analysts was for 460 million dirhams, according to data compiled by Bloomberg.
Emaar rose 1.4 percent to 2.98 dirhams. Deyaar jumped to 29.3 fils, the highest since July 14. There are 100 fils to the dirham. Aldar surged 5.1 percent to 1.04 dirhams, helping push the ADX Real Estate Index up 5.6 percent. The ADX General Index climbed 1 percent.
Sorouh Real Estate PJSC, Abu Dhabi’s second-biggest property developer by market value, advanced 7.5 percent. The company, which may report financial results tomorrow, is likely to say fourth-quarter profit was 108 million dirhams, according to the average estimate of six analysts compiled by Bloomberg. It posted a loss in the year-earlier period.
Kuwait’s measure climbed 1.1 percent and Oman’s MSM30 Index rose 0.3 percent. Saudi Arabia’s Tadawul All Share Index fell 0.2 percent and Bahrain’s BB All Share Index decreased less than 0.1 percent.
The Bloomberg GCC 200 Index, which tracks the biggest 200 companies in the six-member Gulf Cooperation Council, dropped 0.1 percent.
Qatar’s stock market is closed for a national holiday.
To contact the reporter on this story: Alaa Shahine in Dubai at firstname.lastname@example.org
To contact the editor responsible for this story: Claudia Maedler at email@example.com