Shares in Dubai fell to a three-month low on Wednesday, despite a rise in oil prices and a continued recovery by Saudi stocks.
The Dubai Financial Market General Index fell 1.2 per cent to 3,362.17, its lowest level since early July, with the daily trading volume 25 per cent below the average for the past month.
“It’s a liquidity issue rather than a fundamental issue, as oil prices and the Saudi market have been resilient today,” said Tariq Qaqish, the managing director of asset management at Al Mal Capital in Dubai
“Volumes are low, with the result being that you get increased price volatility when investors want to exit their positions.”
Brent crude futures rose 1.8 per cent on Wednesday afternoon to US$51.75 per barrel following a drop in US inventories, while Saudi stocks rose for a second consecutive day for the first time in a month.
Dubai index bellwether Emaar Properties dropped 1 per cent to Dh6.90, with DIB, Emaar Malls and other big names all closing lower.
Shuaa Capital was the pick of just three gainers on Dubai’s headline index, closing up 3.6 per cent at 87.5 fils.
Shares in GFH fell 3.7 per cent to Dh1.04, even after Fitch ratings kept its short-term outlook for the Bahraini investment firm on hold, and revised its long-term outlook to positive from stable.
Shares in Abu Dhabi fell 0.3 per cent to 4,393.58, with gains by Etisalat and Adnic cancelled out by losses by FGB and Aldar Properties.
The Saudi Arabia Index rose 1 per cent.