Sentiments on the UAE stock markets have turned completely negative – as a mix of global events and local concerns fuel investor fears. Within the first two hours of Monday. The index shed more than 100 points, with 28 stocks in the red. (Al Salam Group Holding is the only one as of 11.30am to break the down trend.)
By 12pm, the drop was brought down below 4 points. But it still looks like being a long day for UAE investors.
The real estate stocks, which had been showing signs of strong recovery through the first two months, are particularly hit. "Global concerns over COVID-19 mutations along with the impact that this may have on the local economy have led to stocks hitting circuit-breaker levels of 5 per cent, suggesting investor sentiments are indeed fragile," said Sameer Lakhani of Global Capital Partners. (Once a stock hits a circuit-breaker level, trading is stopped for some time. It can apply to price movements in either direction.)
On ADX, the systemically important stocks are all hitting a negative, with some analysts warning that some additional shocks could be in store for investors in the next 48 hours.
Analysts say recent talk about supply situation in Dubai property has resurfaced as investor worries. Plus, the planned de-listing of DXB Entertainments, the theme park operator, as part of a capital restructuring.
A listing too
Part of International Holding Co, Palms Sports listed ADX’s Second Market under the trading symbol ‘PALMS’. The company’s nominal share capital is Dh150 million, with each share at Dh1. This is the fifth listing on ADX in 2020.