Mid-cap firms lift Dubai index to 5-week high

Dubai's share index surged to a five-week high on Wednesday as traders sent mid-cap stocks soaring.

The benchmark was up 2.9 per cent at 4,235 points at 0921 GMT, reaching its highest intraday level since May 3 to take its gains to 5.4 per cent in two days.

Rival developers

Union Properties and Deyaar rose 14.2 per cent and 10.3 per cent, respectively, while builder Arabtec jumped 14.9 per cent. This trio accounted for more than half of all shares traded on the benchmark.

“This movement is a bit surprising, especially just before Ramadan,’’ said Sebastien Henin, head of asset management at The National Investor in Abu Dhabi.

“What we can guess by looking at the profiles of these companies — high beta, low face value, very liquid names — is that retail investors are very active. There’s a lot of speculation. If you look at the news flow, there is nothing to justify these movements.’’

Ramadan is due to start around June 18. Market trading often slumps during the Muslim holy month.