The UAE’s two stock markets are expected to perform positively in June on the back of new government decisions including the transfer of settlements for both the Dubai Financial Market (DFM) and the Abu Dhabi Securities Exchange (ADX) to the Central Bank of the UAE (CBUAE), according to Zawya.
Trading and gains should be further bolstered in the bourses following the decision to transform the Abu Dhabi Investment Council (ADIA) into a public shareholding company under Mubadala, according to media reports.
Thursday marked the last trading session in May, whereby the DFM registered a 3.32 per cent drop, shedding over 100 points over the course of the month, and closed at 2,964.13 points, pressured by banks and real estate, while the ADX tumbled 1.38 per cent to 4,605.04 points, weighed by telecom and real estate stocks, Zawya said.
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NamaaZone CEO Iyad Aref said that there are several factors that call for optimism in UAE trades, indicating the government’s decision to raise foreign ownership in some UAE-based companies to 100 per cent from 49 per cent as well as the offering of long-term visas, of up to 10 years, to some foreign investors and specialists.
Media reports added that the decision to transform ADIA into a Mubadala-managed firm will attract a lot of liquidity and foreign investments to the markets, in addition to bolstering confidence.
Zawya added that Issam Kassabieh, senior financial analyst at MenaCorp, forecast a rebound in UAE indices on the back of such positive news. June will be distinct, as it coincides with companies’ profit guidance projections ahead of publishing results for the first half of 2018.
The rise in oil prices to around $80 per barrel will likely boost markets in the coming period, Kassabieh said, adding that upgrading Emaar Development’s stock on the MSCI Emerging Markets Index will prompt some selective purchases for low-level-priced stocks.
By Jessica Combes
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