Dubai Rises in Longest Set of Gains Since 2011 on Recovery Bets
Dubai’s benchmark stock index (ADSMI) rose for a ninth day in its longest winning streak in more than two years on investor optimism the emirate is recovering from a property crash and restructuring debt. Abu Dhabi’s gauge gained.
Emaar Properties PJSC (EMAAR), the developer of the world’s tallest building, climbed the most since Feb. 24. Dubai Islamic Bank PJSC (DIB) rose to the highest level since November 2008. The DFM General Index (TA-25) advanced 2.5 percent to 2,352.21, the highest close since October 2009. Today’s gain brought the surge this quarter to 29 percent, making it the second best-performing among 94 gauges tracked globally after Greece. Abu Dhabi’s benchmark added 1.4 percent, led by real-estate companies.
Banks and property companies in Dubai, which is recovering from the 2008 property crash, are rallying after a series of debt restructurings. Dubai Group LLC, an investment company owned by the emirate’s ruler, agreed this month on final terms with its main creditors to restructure $6 billion. Islamic mortgage provider Amlak Finance PJSC (AMLAK) is proposing to extend the maturity on more than $2 billion of loans to creditors, two people familiar with the plan said last week.
“It’s the growing good sentiment about Dubai in general that is generating market momentum,” said Montasser Khelifi, a Dubai-based senior manager for global markets at Quantum Investment Bank Ltd. “We have seen also restructuring deals that are about to be closed for Amlak and Dubai Group so that adds to this good sentiment.”
Dubai’s economy is set to expand 4.6 percent annually, on average, between 2012 and 2015, more than twice the growth of the previous four years, according to government forecasts.
Dubai Islamic, the United Arab Emirates’ largest Shariah-compliant lender, gained 4.1 percent to 3.30 dirhams as trading volume climbed to 3.5 times the three-month daily average. The shares have surged 64 percent this year.
Emaar rose 3.5 percent to 5.97 dirhams, bringing the advance for the year to 59 percent. Emaar and Dubai Holding are to resume work on Al Khiran, a project that was halted amid the 2008 crisis, Al Bayan newspaper reported today.
Abu Dhabi’s ADX General Index increased to the highest level since October 2008 as Sorouh Real Estate and Aldar Properties PJSC (ALDAR) jumped 15 percent. Sorouh soared the most on record as trading volumes surged to almost six times the three-month daily average. Aldar climbed the most since September 2005.
Saudi Arabia’s Tadawul All Share Index (SASEIDX) rose 1 percent at the close in Riyadh, while Qatar’s QE Index (DSM) gained 1 percent. Kuwait’s SE Price Index (KWSEIDX) advanced 1.5 percent, taking this year’s rally to 35 percent. Oman’s MSM30 Index (MSM30) increased 0.3 percent and Bahrain’s gauge added 0.9 percent.
Egypt’s EGX 30 rose 0.4 percent and Israel’s benchmark TA-25 Index gained 0.6 percent at the 4:30 p.m. close in Tel Aviv. The yield on the nation’s benchmark 4.25 percent bonds maturing in 2023 increased two basis points, or 0.02 percentage point, to 3.49 percent.
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