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CBRE Group Inc
Dubai’s benchmark stock index completed the biggest weekly gain since March on optimism Emaar Properties PJSC (EMAAR)’s unit will benefit from Saudi Arabia’s approval of a mortgage law and second-quarter earnings will double.
Emaar, developer of the world’s tallest skyscraper, rallied 1.7 percent today, taking this week’s gain to 10 percent. Gulf General Investment Co. (GGICO), which signed restructuring agreements this week with its lenders, advanced 7.8 percent. The DFM General Index (DFMGI) climbed 1 percent to 1,504.70 at the close in the emirate, the highest since May 10. The measure gained to 3.6 percent this week, the most since the five days ended March 15. The Bloomberg GCC 200 Index (BGCC200) rose 0.1 percent today. Oman’s MSM30 Index (MSM30) snapped a four-day decline, gaining 0.4 percent.
Saudi Arabia (SABIC) this week said its cabinet approved the kingdom’s first mortgage law, which will overhaul the home- financing market. Emaar, which with other investors manages Jeddah-based real-estate consortium Emaar Economic City (EMAAR), said the legislation “will energize the property sector of the kingdom by increasing the affordability of real estate units.”
The market’s rally this week was driven by Emaar “as the Saudi news boosted prospects,” said Waleed Al Khateeb, the senior finance manager at Daman Securities LLC in Dubai. “There are also positive expectations for the company’s second-quarter results.”
The Saudi legislation stipulates regulations to establish mortgage companies and their activities. The kingdom’s mortgage market is the least developed among the six Gulf Cooperation Council states, CBRE Group Inc. (CBG) said in March. The move could potentially encourage banks to offer home financing to a wider segment of the population. Emaar Economic surged 12 percent this week and closed at 9.75 riyals yesterday.
Emaar Properties rose to 3.08 dirhams today. The company’s second-quarter net income may more than double to 503 million dirhams ($137 million), according to the median estimate of three analysts compiled on Bloomberg. The company with the biggest weighting on Dubai’s index has been making a push to get more revenue from abroad. Its operations in Turkey, Pakistan, Egypt, Syria and Saudi Arabia contributed 22 percent to fourth- quarter revenue, up from 8 percent a year earlier.
Gulf General rose to 34.7 fils today, taking its advance this week to 2.4 percent.
About 80 million shares were traded in Dubai today, compared with the 12-month daily average of 137 million shares.
Elsewhere in the Persian Gulf, Abu Dhabi’s ADX General Index (ADSMI), Bahrain’s BB All Share Index (BHSEASI) and Kuwait’s Stock Exchange Price Index (KWSEIDX) were little changed. Qatar’s QE Index gained 0.2 percent. Saudi Arabia’s market was closed for the weekend.
To contact the reporter on this story: Zahra Hankir in Dubai at firstname.lastname@example.org
To contact the editor responsible for this story: Claudia Maedler at email@example.com