Emirates NBD shares declined 0.88 per cent on profit booking, but that didn’t prevent DFM from posting a close on the plus side. The index was pulled higher by du, Dubai Islamic Bank and Emaar Properties, but ADX was lower by 0.25 per cent on August 25.
Recently, du, which gained 3.88 per cent, and Software AG signed a partnership to provide a subscription-based licensing model for IoT services to business customers. The service powered by Software AG’s Cumulocity IoT will position du as the leading IoT provider in the market. The stock, currently trading at Dh5.35 with a market capitalization of Dh24.25 billion, yields 6.36 per cent.
Dubai Islamic Insurance and Reinsurance Company (better known as Aman) shares declined by 1.91 per cent after it denied any negotiations had been held to acquire the company.
A majority at work
After the acquisition of a majority stake in in GB Corp, Bahrain’s GFH Group has recognized negative goodwill of $8.41 million and net cash inflow of $32.85 million. GFH has informed the exchanges that it was able to acquire shares at a bargain price.
Globally, the announcement of vaccines by Pfizer and Moderna triggered a rally in travel and entertainment sectors. Airlines were among the biggest gainers in the last US trading session.
This bodes well for UAE equities as the non-oil economy here is dependent on trade and tourism to a large extend. Even though recovery in the real economy might have to wait for the beginning of next year, there is a good probability that sectoral shares will rally ahead of the actual recovery.
For international investors, UAE economy is a proxy for the global economy given its strong integration. And equities here are interestingly poised with both DFM and ADX hovering around the 200-day simple moving average.
- Vijay Valecha is Chief Investment Officer at Century Financial.