26/01/2017 08:08 AST
Gulf Finance House (GFH) shares, which hit its highest level in 52 weeks earlier on Wednesday, fell nearly 10 per cent, causing panic among retail investors, triggering a sell-off on Dubai and Abu Dhabi bourses.
GFH settled 9.67 per cent lower at Dh2.43, after hitting a high of Dh2.90, its highest in 52 weeks.
“GFH is the current market leader. So as soon as the stock fell, retail clients got a bit worried and started dumping all the stocks,” said Ahmed Waheed, Vice President — Institutional Desk, Menacorp. “The market is more retail based, and we didn’t see much trading in terms of blue chips,”
Traded value for GFH came in at Dh789 million, contributing to nearly 50 per cent of the total. The second most active stock was Dubai Islamic Bank, where shares worth Dh93 million were traded. DIB shares closed 0.49 per cent higher at Dh6.14.
Among other losers, Shuaa Capital closed 5.88 per cent lower at Dh1.6. Drake and Scull closed 4.89 per cent lower at Dh0.525. Arabtec closed down more than 2 per cent at Dh1.34.
In Abu Dhabi, the general index closed 1.55 per cent lower at 4,606.50. Eshraq Properties closed 6.61 per cent lower at Dh1.13, while Aldar Properties closed 2.53 per cent lower at Dh2.63.
“The international markets sentiment is positive, we saw new highs yesterday. The only thing is our market is controlled by retail participants. It should not continue going down,” Waheed said.
GFH has been the best performing stock in Dubai, registering more than 400 per cent gains last year, compared to 12 per cent rise on Dubai index.
Through the second half of last year, most of the retail trades were cornered by small cap stocks, however the large cap stocks underperformed compared to the index.
On Wednesday, elsewhere in the Gulf, Saudi Arabia’s Tadawul index was 0.69 per cent higher at 7,141.11. The Qatar exchange index closed 0.20 per cent lower at 11,035.61. The Muscat MSM 30 index closed flat at 5,764.96.
Gulfnews
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