Dubai Financial Market (DFM) yesterday recorded the strongest performance in three and a half years, with the market index rising 4.77%, with Emirates NBD rising to its highest level in 12 years, following the increase of foreign ownership in the bank's shares.

Financial analysts described the performance of the market as a quantum leap, pointing out that the positive news related to the stock opened the «appetite» investors in the market.

They pointed to other factors that supported the DFM index, including new decisions aimed at adjusting the course of the real estate sector, and the formation of a high-level committee so that these projects have added value to the national economy.

Market movement

The Dubai Financial Market (DFM) index rose 4.77% yesterday to end the trading session, driven by Emirates NBD's growth, following the decision to increase foreign ownership in the bank from 5% to 20%.

The stock recorded a rise of 14.85% to its highest level since October 2007, closing at AED 13.15. The market was the most active in terms of liquidity recording AED 324.3 million.

A total of 211.949 million shares changed hands in 4438 transactions at a total value of AED 634.33 million.

Dubai Financial Market recorded an increase in its market capitalization by AED 13.9 billion, to AED 375.3 billion in total market capitalization at the end of yesterday's session.

On the sectoral level, the banking sector led the gains after jumping 8.15%, followed by the consumer goods sector by 3.11%, followed by investment and financial services by 2.85%, and real estate by 2.17%.

In Abu Dhabi, the general index of the Abu Dhabi Securities Market rose 0.68%, equivalent to 34.84 points, to close at 5156.01 points. A total of 61.444 million shares changed hands, with a turnover of AED 232.175 million, after 1870 transactions. The market capitalization increased by 5.2 billion dirhams to 529.8 billion dirhams.

Positive news

Mohamed Ali Yassin, Chief Executive, Strategies and Clients of Al Dhabi Capital, said that the announcement by Emirates NBD of raising foreign ownership from 5% to 20% and his intention to increase it to 40% is one of the main reasons for the Dubai Financial Market. .

He pointed out that this positive news related to this stock, opened the appetite of investors in the market, which was waiting for positive news, expecting a good performance for the market in the coming days, especially with the positive news related to the real estate sector, which rose in the sector as a whole during yesterday's session, which is related to Adjust the rhythm of the real estate market, and form a high-level committee to follow the sector.

A qualitative leap

Abdul Qader Shaath, the branch manager of Al Ansari Financial Services, said that the DFM's qualitative leap during yesterday's session was expected, but with lower gains, especially as a large percentage of liquidity was waiting for positive news to enter the market.

He stressed that the positive news related to the increase in the proportion of foreigners in the market contributed to encourage many investors, both individuals and portfolios, to enter the market.

He added: “The attention of the portfolios and funds will be focused on the local markets in the coming period, in conjunction with the possibility of replicating the scenario of Emirates NBD with other companies in the market, as it is expected that the possibility of raising the percentage of foreign capital in these companies.” Emirates NBD's initiative will not be the last in the market, especially as local stocks are still at good levels in terms of profitability compared to neighboring markets.

Real estate sector

Tarek Qaqish, Managing Director of MENA Corp, said that the immediate increase in foreign ownership of Emirates NBD from 5% to 20% was one of the main reasons for the rise in local equity indices, especially in The impact of this news is to encourage many investors to enter the market, in addition to the possibility of repeated raising this percentage with other companies.

He pointed to other factors that supported the DFM index, including new decisions aimed at adjusting the course of the real estate sector, and the formation of a high-level committee so that these projects have added value to the national economy.