Emaar Properties PJSC (EMAAR) dropped the most since September, leading declines in Dubai’s benchmark index, amid bets a rally before the United Arab Emirates’ upgrade to MSCI Emerging Market status was overdone.
The builder of the world’s tallest tower declined 4.1 percent, the biggest drop in eight months, to 10.45 dirhams at the close in Dubai. That trimmed this year’s gain to 50 percent. Dubai’s DFM General Index (DFMGI) was the second-worst performer among more than 90 indexes tracked globally by Bloomberg, falling 2.6 percent to 5,181.14. Dubai Islamic Bank PJSC, the largest Islamic lender in the United Arab Emirates, fell the most in two months after MSCI yesterday named the constituents of its indexes.
“These stocks had such a phenomenal run leading up to inclusion in MSCI index, it’s fair to say all of it has been priced in,” Nayal Khan, head of institutional sales and trading at Naeem Holding in Dubai, said by phone. “We’re going to see some rotation now into some of the non-MSCI names. From now to the end of the month, we could see some profit taking.”
Dubai’s measure has more than doubled since June last year when reclassification of the markets to emerging from frontier status was announced. Emaar will be among the biggest additions to MSCI’s Emerging Market gauge when the index provider upgrades the U.A.E. and Qatar from June 1, MSCI said yesterday.
Emaar, whose weighting on MSCI’s U.A.E. index was cut by more than half, said today first-quarter revenue from land sales fell 17 percent.
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