UAE investors turn risk averse after 2-day Saudi sell-off

Dubai

Two days of sell-off in Saudi stocks triggered cautious moves from UAE investors, preferring to shun risk and take some cash off the table.

The Dubai Financial Market General Index closed 1.91 per cent lower at 3,408.06. About 189 million shares were traded on Monday, compared to over 200 million shares on Thursday. Markets were shut on Sunday due to the Hijri new year. The Abu Dhabi Securities Exchange General Index closed 1.79 per cent lower at 4,396.37.

“There seems to be a spillover of austerity measures announced in Saudi Arabia into the regional equity markets,” said Vijay Harpalani, Fund Manager, Asset Management at Al Mal Capital.

“Investors seem to be exercising caution ahead of Q3 corporate earnings season, which is expected to be weak,” Harpalani said. Dubai and Abu Dhabi stocks witnessed broad based selling with almost all the stocks ending in negative.

Emaar Properties closed 2.92 per cent lower at Dh6.90, while Gulf Finance House ended 3.60 per cent lower at Dh1.07. Arabtec closed 2.04 per cent lower at Dh 1.44. DXB Entertainments closed 3.16 per cent lower at Dh1.530. Drake and Scull closed more than 3 per cent lower at Dh0.486. Out of a total of 33 stocks traded on the exchange, shares of 31 firms fell, while only one stock ended in the positive.

In Abu Dhabi, Eshraq Properties closed more than 1 per cent lower at Dh0.84. Dana Gas closed 0.39 per cent lower at Dh2.66. Out of a total of 17 stocks traded on the exchange, shares of 7 firms fell, while other three rose.

Saudi stocks fall too

Shares in Saudi stocks fell continuing its losing streak, that started after the government undertook austerity measures. The Tadawul index was 0.45 per cent lower at 5,423.78. Rajhi Bank closed 1.08 per cent lower at 50.25 Saudi riyals. However, petroleum stocks in Saudi Arabia recovered for another session taking leads from crude oil. Advanced Petrochem was up 2.97 per cent, while Petrochem was up over 5.22 per cent. Saudi Kayan was up more than 4 per cent.

Elsewhere in the Gulf, Qatar exchange index closed 0.90 per cent lower at 10,309.92. Kuwait stock exchange index closed 0.74 per cent lower at 5,358.53.