Dubai stocks fell after profit at the UAE’s biggest construction company tumbled by almost half.
The DFM General Index lost 1.4 per cent, the most since March 18, to 3,425.69 at the close. Arabtec was the biggest decliner on Dubai’s measure, slipping 9.9 per cent to Dh2.36, the lowest since January 2014.
Net income at Arabtec, which helped build Burj Khalifa in Dubai, the tallest tower in the world, slumped 48 per cent to Dh241.6 million after expenses jumped 75 per cent during the period, it said in a statement to the local bourse. Changes in the builder’s top management last year sparked a selloff in June, pushing Dubai’s gauge into a bear market.
“Arabtec is seeing some strong selling pressure on the back of disappointing profit numbers,” Hisham Khairy, the Dubai-based head of institutional trade at Mena Corp, said by phone. “It’s weighing on sentiment and investors are booking some profit after a strong session on Thursday.”
Dubai’s index climbed 1.9 per cent on Thursday, the biggest jump since February 3. The gauge has fallen 9.2 per cent this year, poised for a second quarterly decline.
Arabtec has slumped 19 per cent in six straight days of losses and is trading below its 50-, 100- and 200-day moving averages. Its 14-day relative strength indicator declined to about 19, the lowest in two years. A level below 30 indicates to some analysts a security is oversold.
The company said it plans to “significantly” reduce expenses this year and has suspended operations in Pakistan and Russia to cut costs. Still, Arabtec will explore opportunities for acquisitions and doesn’t plan to delist shares from Dubai’s bourse, it said.
Elsewhere in the region, Saudi Arabia’s Tadawul All Share Index rose 1.1 per cent, Egypt’s EGX 30 Index fell 1.2 per cent, Bahrain’s BB All Share Index retreated 0.5 per cent and Kuwait’s SE Price Index lost 0.2 per cent. Oman’s MSM 30 Index added 0.2 per cent.
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