Abu Dhabi: The region’s stock markets are likely to gain this week, say experts on the back of some strong second quarter corporate earnings - several of which exceeded analysts’ expectations, global oil prices gaining traction and euphoria generated by latest the US employment data, which showed the world’s largest economy added 163,000 jobs in July.
“The markets should open on a positive note on Sunday. We saw significant foreign inflows in Dubai in July predominantly focussing on Emaar, which spilled over to other core companies in the UAE such as Aldar, Sorouh, Drake & Scull, First Gulf Bank and Abu Dhabi Commercial Bank,” Anastasios Dalgiannakis, Head of Trading at Dubai-based Mubasher Financial Services told Gulf News by telephone.
“We expect retail activity to pick up post-Ramadan...the market should continue to remain supported, assuming a benign international environment,” Dalgiannakis added.
However, Europe’s biggest economies battered by a paralysing debt crisis endured another torrid month in July as businesses battled slumping demand, which analysts say, could limit the markets’ upside potential.
“According to President Rajoy, the Spanish government considers - for the first time - a request for a full bailout, after European Central Bank (ECB) President Mario Draghi outlined the procedure, which would allow the European Financial Stability Mechanism (EFSF) to help member states,” wrote Emirates NBD’s analyst in his latest research note.
“The press conference that followed from ECB President Draghi disappointed and encouraged the markets in equal measure. It seems that the ECB will be able and willing to act, if the clearly outlined requirements from member states are met,” he added.
