Arabtec jumped to the highest in almost four months as traders speculated former chief executive Hasan Ismaik is adding to his stake.
The builder soared 14 per cent to Dh1.44 12.15pm in Dubai, the biggest jump since June. More than 368 million shares changed hands, about 14-times the six-month intraday average. Ismaik has started buying shares in the company more than 36 per cent owned by Abu Dhabi’s Aabar Investments, CNBC Arabia reported on Monday, citing people it didn’t identify.
There are “rumors that one of the major shareholders of Arabtec is adding to his holding, which has historically generated substantial interest among investors,” said Asjad Yahya, the Dubai-based head of research at Shuaa Capital. There’s also “some speculation of positive developments at the company on the back of financing closed by Aabar,” he said.
The biggest listed construction company in the UAE was at the centre of a stock selloff that wiped a fifth from Dubai’s benchmark index in 2014 amid a reshuffle of senior management and investor concern the company was losing Abu Dhabi-government support. Arabtec shares never recovered and are down about 80 per cent from their peak.
The stock’s 14-day relative-strength index rose above 70 for the first time since June, a signal to some analysts shares may be overbought and poised to decline.
Ismaik holds 11.81 per cent of Arabtec, according to data compiled by Bloomberg. Spokespeople for the former CEO and Aabar didn’t immediately respond to requests for comment. A spokeswoman for Arabtec declined to comment.
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