Dubai rally stalls as trading spikes

DUBAI: Dubai's rally stalled but trading volumes surged as investors chased expectations of a possible upgrade for the UAE by index compiler MSCI.
Dubai's index slipped 0.3 percent, easing off its 54-month high as investors booked profits after an intraday high of 2,500, which posed as technical resistance level.
MSCI will announce next week whether it will upgrade the UAE to emerging market status. It currently ranks the country as a frontier market.
"International institutional investors are speculating on an MSCI upgrade," said Mohammed Yasin, managing director of Abu Dhabi Financial Services.
"The high volumes and the performance has attracted them."
"I'm not worried about the levels, many stocks fundamentally justify the price and more, but the speed of the rally means we're setting ourselves up for a correction," Yasin added.
The number of shares changing hands reached 1.29 billion, the first time daily volumes exceeded a billion since June 2009.
In Kuwait, the benchmark rose 1.9 percent, rebounding after sessions of losses as large-caps gained.
Recent declines on Kuwait's bourse were expected to be short-lived as a bullish sentiment remains intact after firms reported positive earnings for the first three months of 2013.
"The fact that numbers are at par on last year shows these companies are doing well and there is stability to ride this wave," said Jasem Al-Zeraei, head of institutional sales at NBK Capital.
The market is up 38.2 percent year-to-date.
National Bank of Kuwait reported a flat first-quarter net profit but beat analysts' estimates.
The stock added 1 percent.
Large-caps led gains as the flow of funds shift from smaller caps, many of which have doubled in an early-year surge.
Investors are now risking more in large-caps.
First Dubai Real Estate has surged 328 percent year-to-date, while NBK, the largest listed stock, is up 6.1 percent over the same period.