Dubai Stocks Climb on First Day as Emerging Market: Dubai Mover

Dubai’s stocks rose, spurred by funds from money managers tracking the MSCI Emerging Markets Index who had yet to buy into the world’s best-performing gauge.

The DFM General Index added 1.9 percent to 5,151.21, the highest close since May 15. Emaar Properties PJSC, the stock with the biggest weighting on the index, jumped 3.5 percent. Arabtec Holding climbed as much as 3.1 percent before closing 0.9 percent higher. Dubai’s measure has surged 53 percent this year, the most among more than 90 gauges tracked by Bloomberg.

MSCI, whose measures are followed by investors managing about $8 trillion in assets, in June last year said it will raise the United Arab Emirates and Qatar to developing markets status from frontier as of today. The reclassification may attract more than $905 million to the stocks listed in the U.A.E. and $649 million to Qatar, HSBC Holdings Plc said in a note on May 12.

“It’s residual buying as the funds that have not allocated yet are gradually making allocations,” Talal Touqan, the head of research at Abu Dhabi-based Al Ramz Securities, said by phone. “The direction is still intact in terms of an upward move, but we need to see lower volatility for investors’ nervousness to ebb away.”

The 30-day historical volatility for Dubai’s gauge was 38, compared with 9 for MSCI Inc.’s developing markets measure, according to data compiled by Bloomberg.

Emaar, whose shares are up 50 percent this year, jumped to 10.40 dirhams. Arabtec climbed to 6.58 dirhams. Both companies are included in the MSCI Emerging Markets Index.

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