Dubai's shares were hit by a sell-off yesterday, led by Arabtec Holding, amid investor fears of dilution after the region's biggest contractor announced it would undergo a rights issue and Dh1.6 billion of convertible bonds.
Arabtec's shares retreated 3.3 per cent to close at Dh2.10 each on the Dubai Financial Market yesterday. The stock fell as much as 8.2 per cent during the trading session and this was its fourth such decline since Thursday, when the announcement was made.
Arabtec tumbled 9.8 per cent on Thursday, 9.7 per cent on Sunday, and 9.9 per cent on Monday. The DFM General Index lost 1.1 per cent to close at 1,876.62 points.
The benchmark is up almost 15 per cent since January.
"Investors are worried about dilution of their holdings in Arabtec following the announcements, but at the same time the market needed to take a breather," said Tariq Qaqish, the head of asset management at Al Mal Capital in Dubai.
On the Abu Dhabi Securities Exchange, the property stocks Aldar and Sorouh continued to fall following shareholder approval of their merger.
Aldar declined 2 per cent yesterday to close at Dh1.44. The shares fell 5.1 per cent the day before. Sorouh lost 2.7 per cent off the value of its shares to close at Dh1.76 yesterday, after declining 3.7 per cent on Monday.
The ADX General Index ended 0.2 per cent lower to 3,019.77.
