Business | Markets
UAE shares arrest decline amidst US rate confusion
UAE markets recorded modest gains on low volumes yesterday, indicating the end of the freefall and investor concerns about the level of interest rates reduction.
- By Ahmed A. Elewa, Staff Reporter
- Published: 01:28 January 31, 2008
Abu Dhabi: UAE markets recorded modest gains on low volumes yesterday, indicating the end of the freefall and investor concerns about the level of interest rates reduction.
"Although everyone agrees that a rate cut is imminent in the US, strong economic data from there is confusing investors as to whether the cut will be high or low," Ahmad Abdul Rahman, head of research at Amanah Capital. He expected the Fed to cut rates about 50 basis points, and UAE Central Bank to mirror the move.
"[For] Emaar to advance from Dh12.15 to Dh12.30 towards the end of the session is a strong indicator that investors are taking positions, while strong expectations from Dubai Islamic Bank results drove the share price up sharply. All indicators are positive towards having a very strong session on Thursday," he added.
Dubai's benchmark index advanced by 0.72 per cent to 5,533.54 on account of modest gains by most of the leading shares. Dubai Financial Market and DIB outperformed other blue chips and surged by 3.27 and 3.40 per cent respectively.
In Abu Dhabi, the general index advanced by 0.27 per cent to 4,585.40, reflecting investors' anxiety in relation to interest rates cuts.
Aldar Properties and Sorouh Real Estate recovered by 1.98 and 0.49 per cent, while the National Bank of Abu Dhabi and Etisalat gained 1.25 and 0.43 per cent respectively.
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