Trading on Dubai Financial Market (DFM) remained sideways but the market closed positive on Tuesday as investors looked cautiously optimistic.
The benchmark index closed at 1,716.57, up marginally by 10.33 points or 0.61 per cent. At noon, DFM was at 1,713.45, up marginally by 7.21 points or 0.42 per cent. All sectoral indices except utilities and banks were pushing the market up, and out of 26 stocks being traded only 10 were trading in the green.
However, buying momentum picked up in the afternoon session and out of 27 stocks traded 16 advanced, 4 remained unchanged while only 7 declined.
Major gainers included Al Salam Bank Sudan, Ekttitab, Arabtec, Drake and Scull International, Deyaar, Emaar, Takaful Emarat, Shuaa Capital among others.
Stocks of Arabtec topped both in terms of volume as well as value of traded shares on Tuesday.
Abu Dhabi Securities Exchange (ADX) however declined by 9.31 points to close at 2,740.11.
The UAE handset retailer Axiom Telecom cancelled its initial public offering (IPO) on Monday, citing 'market conditions and liquidity' concerns, according to Reuters report.
Experts however believe Axiom announcing its decision to cancel the company's IPO of shares and listing on Nasdaq Dubai still has some positive elements.
"While the market might perceive Axiom's decision to cancel its IPO as a setback, Frost & Sullivan believes that there are positives to be taken away from the announcement," Lindsey McDonald, Consultant, Information & Communication Technologies Practice, MENA, Frost & Sullivan said in an emailed statement.
"Firstly, the decision shows prudent strategic planning on the part of the company - a crucial element in sustainable business practices. Secondly, this is an opportunity for the service provider to re-evaluate its strategy and perhaps reconsider its expressed plan of eventually assuming the role of a Mobile Virtual Network Operator (MVNO). It would make sense that Axiom revisits the idea on an IPO once market circumstances are better. An alternative might be to list in another territory in which it has operational presence, if the market conditions are more conducive to success," McDonald added.
Subdued buying momentum on DFM also seem to have got support from the rise seen across almost all major Asia-Pacific markets as well as European markets, as per the latest data.
The latest weekly report of December 6, by Rothschild Private Banking and Trust said, banks remain fragile around the world and last Friday's (December 3) numbers on US employment were disappointing.
Further, it added, the ongoing problems in the eurozone are keeping investors nervous as following the bail-out of Ireland, attention has shifted to other weak spots in Europe. The stability of the banking system in Spain remains an ongoing issue. Across the eurozone, banks remain heavily exposed to the sovereign debt problems in countries such as Greece, Ireland and Portugal and many banks are heavily reliant on the ECB to meet their liquidity and borrowing needs.
Nevertheless the report adds: "We are continuing to position ourselves for a modest economic recovery. The investment case for equities has grown stronger recently, as the economic outlook has improved. Earnings have been solid and valuations are undemanding. That said, there are risks of a setback in the short term and any signs of an economic downturn would be bad news for equities". Emirates 24|7
