DUBAI Feb 10 Dubai's Emaar Properties
surged to a four-year high on Sunday as upbeat research reports
from international banks bolstered demand from local and foreign
investors, while oil price gains helped lift most Middle East
Emaar, the Dubai Financial Market's largest listed
company, climbed 5.7 percent to 5.01 dirhams, its highest finish
since November 2008.
Since that peak, Dubai property prices have slumped,
ravaging the sector and leading to a slew of cancelled or
Emaar has sought to offset this slump by diversifying into
retail and hospitality and its shares are up 34 percent in 2013.
In a Feb. 4 report, Bank of America Merrill Lynch gave Emaar
a buy rating and a target price of 5.3 dirhams, while HSBC's
Feb. 7 report set the developer a target price of 6 dirhams and
an overweight rating.
"We continue to be surprised by the strength in the Dubai
property market, on the residential, hotel, and retail side,"
HSBC wrote. "Supply additions are still a concern but not as
much as in the past."
Traders say these reports have buoyed sentiment for Emaar,
with property prices also bottoming out and even increasing in
some districts after declines of about 60 percent from their
Investors also seem to have shrugged off Emaar's 28 percent
drop in fourth-quarter profit.
"The market saw a lot of institutional interest in Emaar
today, which is mainly due to its potential upside in revenue in
2013 and expectations for high dividend yields," said Marwan
Shurrab, vice-president at Gulfmena Investments.
"We've been seeing a lot of (analyst) upgrades from major
houses and that's helping raise interest from institutional
investors abroad, bringing in new cash to our market."
Dubai's index climbed 2.2 percent to its highest finish
since Nov. 30, 2009 and up 17.1 percent this year.
The benchmark now has a relative strength index reading of
75.2 - a value above 70 typically indicates it is overbought -
and it followed a similar pattern last year when an early-year
surge petered out from early March.
Yet 2013's rally appears more convincing, said Sebastien
Henin, portfolio manager at The National Investor in Abu Dhabi.
"It's very different from last year, which was extremely
speculative with movement in penny stocks and high-beta names -
this time it's mainly driven by bluechip stocks," he said.
Oil price gains - Brent crude hit a nine-month high
on Friday - have underpinned foreign interest in regional
equities and stocks from the United Arab Emirates in particular.
"This will be the main theme in the coming days," said
Henin. "We're starting to see sector rotation towards banks -
results were pretty good and their dividend yields are extremely
attractive in the current world of low interest rates."
In Kuwait, late buying helped the main price index
rise 0.07 percent, nearing Tuesday's nine-month peak.
"Speculation is the driving force behind the appreciation in
stock prices," said Naser al-Nafisi, general manager for Al
Joman Center for Economic Consultancy in Kuwait.
The market slumped to an eight-year low in November as
Kuwaitis took to the streets to demonstrate against changes to
electoral rules that opponents said would benefit the government
and sideline critics. Since then, the political temperature has
cooled and shares have rallied, helped by equity buying by
* The index climbed 2.2 percent to 1,900 points.
* The index fell 0.5 percent to 2,894 points.
* The index edged up 0.07 percent to 6,293 points.
* The index rose 0.2 percent to 7,012 points.
* The index climbed 0.2 percent to 5,713 points.
* The index rose 0.1 percent to 8,770 points.
The index advanced 0.2 percent to 5,862 points.
* The index slipped 0.2 percent to 1,086 points.