Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
Gulf Cement and Dubai National Insurance emerged as October’s top performers on the Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM), respectively, delivering double-digit gains even as both markets’ benchmark indices declined amid continuing regional tensions.
Gulf Cement rose 23.5%, while Dubai National Insurance gained 14.8%, according to Kamco Invest’s GCC Markets Monthly Report.
Selected stocks advanced despite broader weakness, while the market declines brought lower valuation multiples and higher dividend yields on both exchanges, potentially making shares more attractive to investors seeking entry at lower prices.
ADX’s trailing price-to-earnings (P/E) ratio eased to 16.29 times in October from 17.33 times in September, while its price-to-book (P/B) ratio fell to 2.13 from 2.27. Its dividend yield increased to 2.64% from 2.48%.
DFM’s trailing P/E ratio declined to 8.85 times from 9.14 times, while its P/B ratio eased to 1.62 from 1.67. The market’s dividend yield rose to 5.53% from 5.28%.
The ADX General Index closed October at 9,466.34 points, down 6%, ending four consecutive months of gains. The decline left the benchmark 5.3% lower since the start of the year.
Alongside Gulf Cement, United Arab Bank and Abu Dhabi Aviation were among the strongest performers, rising 12% and 7.6%, respectively. United Arab Bank reported a 5.6% year-on-year increase in nine-month net profit to Dh333.3 million, compared with Dh315.6 million a year earlier.
Nine of ADX’s 10 sector indices declined, while utilities remained unchanged. Consumer staples and consumer discretionary stocks were relatively steady, with their sector indices each slipping 0.2%.
Telecommunications fell 3.7%, energy declined 4.2% and real estate lost 5.2%. Financials and industrials retreated 6.6% and 6.9%, respectively, while healthcare declined 9.4% and basic materials fell 11.1%.
Abu Dhabi National Investment and Development Company, formerly known as BILDCO, recorded the largest individual share-price decline at 23.2%, followed by Phoenix Group at 19.7% and GFH Financial Group at 17.2%.
ADX trading value totalled Dh20.18 billion, down 15.3% from September, while trading volume fell 31.4% to 4.29 billion shares. Market capitalisation stood at Dh2.25 trillion at October-end.
ADNOC Gas led trading volumes with approximately 800 million shares exchanged, followed by Eshraq Investments with 433.8 million and Borouge with 315.5 million.
International Holding Company topped turnover with Dh2.8 billion worth of shares traded, followed by ADNOC Gas at Dh2.6 billion and First Abu Dhabi Bank at Dh2.1 billion.
In Dubai, the DFM General Index closed at 5,770.7 points, down 3.2%, following gains in August and September. The benchmark ended October 4.6% below its level at the start of the year.
Dubai National Insurance led the gainers, followed by Watania International Holding, which advanced 8.2%, and Air Arabia, up 3.3%.
Communication services provided a positive contribution, rising 3%, reflecting an equivalent increase in Emirates Integrated Telecommunications Company, the sector’s sole constituent.
The remaining seven sectors declined. Materials eased 1.2% and utilities fell 1.3%, while consumer discretionary and industrials each declined 3%. Real estate lost 4.3%, financials fell 4.7% and consumer staples declined 5.7%.
Islamic Arab Insurance Company recorded the largest share-price decline at 24.1%, followed by Dubai Islamic Insurance Company at 21.5% and GFH Financial Group at 18.3%.
DFM trading value reached Dh10.41 billion, down 24.9% from September, while volume declined 43.3% to 3.51 billion shares.
Drake & Scull International led trading volumes with 726.6 million shares, followed by Shuaa Capital with 364.4 million and Dubai Islamic Insurance Company with 347.8 million.
Emaar Properties topped trading value at Dh3.9 billion, followed by Emirates NBD at Dh1.3 billion and Emaar Development at Dh900 million.
Across the region, the MSCI GCC Index declined 4.3% in October, taking its year-to-date loss to 4.6%. All GCC markets ended lower: Saudi Arabia fell 5%, Bahrain 4.1%, Kuwait 3.7% and Oman 2.9%, while Qatar recorded the smallest decline at 1%. Despite October’s retreat, Oman retained a year-to-date gain of 25.2%, the strongest regional performance.
“October’s market performance highlights opportunities in individual UAE-listed companies, with several stocks delivering encouraging gains despite a challenging regional environment,” Sayed A, Chief Business Officer at Graystone Capital, said.
Gains in Gulf Cement, United Arab Bank, Abu Dhabi Aviation and Dubai National Insurance demonstrate that opportunities remain across different sectors even when broader indices decline, he said.
“One encouraging aspect is the easing of market valuation multiples and the rise in dividend yields, which could create attractive opportunities for investors taking a longer-term view,” Sayed said.
ADX and DFM continue to offer exposure to established businesses across banking, energy, real estate, insurance and other key sectors. “The strong trading positions of major companies and the continued participation of investors underline the importance of both exchanges in the region’s financial ecosystem,” Sayed said.
“In my view, the UAE’s long-term investment proposition remains supported by its economic diversification, strong regulatory framework, international connectivity and continued development as a global financial hub,” Sayed said.
“Short-term market movements are part of the normal investment cycle, and the current environment could present opportunities for investors taking a longer-term view of the UAE’s growth prospects,” he added.
