UAE stocks bounce back after US-Iran turbulence
Benchmarks on DFM, ADX wipe out steep losses recorded at peak of Middle East crisis
Dubai: Top benchmarks on UAE bourses rose on Monday, nearly making up for the steep losses recorded last week when US-Iran tensions peaked.
The top index on the Dubai Financial Market (DFM) ended 0.84 per cent up — at 2,775.58 points, on a day of moderate trading — while the Abu Dhabi Securities Exchange (ADX) rose 0.59 per cent to 5,113.75.
The gains recorded by both indices on Monday helped them nearly wipe out last week’s losses.
The DFM fell by more than 3 per cent last week, when Middle East tensions escalated the most, while the ADX shed over 1.5 per cent.
Both indices were about 20 points away from regaining the prior week’s losses.
Iyad Abu Hweij, managing director at Allied Investment Partners PJSC, said markets continued to maintain the positive momentum as the Middle East tensions receded, amid de-escalation by the United States and Iran.
Lenders led the gains in both the emirates’ stock exchanges.
In Dubai, Emirates NBD ticked up 1.9 per cent and Dubai Islamic Bank gained about 1 per cent, while in Abu Dhabi, First Abu Dhabi Bank gained 0.7 per cent.
“Investors are superseding the concerns by shifting their attention towards improving macroeconomic environment and upcoming earnings season,” Abu Hweij added. “For the regional markets, the heightened geopolitical risk in the Middle East will continue to play out in the coming weeks and investors might look for signs of stabilisation to regain confidence.”
GCC corporate profits are expected to increase by around 6.5 per cent this year, according to a study by analysts at Marmore Research.