UAE property stocks rallied on Thursday, with Dubaiís benchmark making its largest one-day gain in nearly four months, and Gulf sentiment rose after European leaders struck a deal to resolve a two-year-old sovereign debt crisis.
Dubaiís heavyweight Emaar Properties jumped 4.8 percent. After market hours, it reported a 34-percent-drop in third-quarter net profit, but its retail and leisure business boosted revenues.
Union Properties gained 6.6 percent as the sector took support from a $1 billion real estate investment fund that the emirate launched with Canadaís Brookfield Asset Management, in a bid to revive the battered sector and restore investor confidence.
ďAnytime there is support from the government, it is taken positively,Ē said Marwan Shurrab, vice-president and chief trader at Gulfmena Investments.
ďIt is one of the big reasons why real estate stocks are rising today, after the euro zone-induced gloom lifted.Ē
Europe struck a deal for a haircut on Greek debt and agreed to beef up the regionís rescue fund to contain the long-drawn debt crisis, lifting global stocks.
Dubaiís index rose 1.9 percent, its biggest daily gain since July 3, to end at its highest close in over a week.
In Abu Dhabi, Aldar Properties climbed 3 percent and Sorouh Real Estate added 3.3 percent.
Abu Dhabiís index rose 0.7 percent, its fourth-straight gain.
ďInvestors got excited about the decision in Europe and global marketís (upward) move,Ē said Samer Al-Jaouni, general manager of Middle East Financial Brokerage.
ďBut the main issue is that there isnít much liquidity and the market isnít deep. Thatís the reason behind the sharp price rise in prices.Ē
In Qatar, the benchmark rose 0.9 percent to a 23-week high as key stocks jumped on fundamentals.
Industries Qatar rose 2.3 percent to its highest level since early August.
Doha Bank gained 1.9 percent, Qatar National Bank rose 1 percent and Commercial Bank of Qatar climbed 1.4 percent.
ďHistorically institutional buyers are used to building positions in banks and industries stocks, especially Industries Qatar, before the year-end,Ē said Jaouni.
ďValuations are attracting investors and the rally is supported by strong expected dividends in Qatar.Ē
In Oman, telecom operator Nawras gained 1.9 percent after its quarterly net profit beat estimates.
ďOn the whole, we remain positive on the stock post Q3 results,Ē said Kanaga Sundar, Gulf Baader Capital Markets head of research. The companyís total revenue was in line with Baaderís estimate, he added.
Muscatís index gained 0.3 percent in its third-straight advance.
Volumes in Gulf markets are expected to remain subdued as investors unwind positions ahead of the Muslim holiday of Eid Al-Adha.
ďHopefully, the markets will get some life back and see decent liquidity after Eid as people start looking at the year ahead,Ē said Ibrahim Masood, senior investment officer at Mashreq bank. ďRight now institutionals have shut down mentally and expect dull, sideways markets for the next two weeks.Ē