Abu Dhabi stocks continued their bull run in line with global markets that have been on the rise ahead of key central bank meetings, including that of the US Federal Reserve.
Abu Dhabi Securities Exchange gained 0.4 per cent to 5,728 points, marking its fifth back-to-back advance. Banks played the leading role, with Bank of Sharjah shooting up 6.1 per cent, and with First Abu Dhabi Bank and Abu Dhabi Islamic Bank joining in with 0.7 and 0.2 per cent gains.
Banks stand to gain
Investors are betting that central banks will raise interest rates sooner than expected to contain inflationary threats. UAE and some other Gulf countries have their currencies pegged to the dollar, which means any rate hikes there trigger similar moves at GCC central banks. Investors are upbeat about the prospect that lenders will be well-positioned to benefit from rate rises, as they would be able to charge higher for what they would lend.
"The Tadawul Main Index inched higher by 0.4% to 9,685, erasing yesterday’s gains. Most of the sectors are up on the day, except for technology and utilities. Petro Rabigh soared 9.92% to SR17.28 and Saudi Kayan earned 4.62% to SR16.32."
A breather
Dubai Financial Market traded fractionally lower after four days of gains. But the index might well reverse the marginal downward move by the end of today as was the case on Monday. There's a lot happening that can attract investors towards Dubai stocks, ranging from the recently passed $1.9 trillion stimulus package to the emirate's 2040 urban development plan and central banks' meetings this week.
In early trade, stocks were almost equally divided between gainers and losers, but the weakness in heavyweight stocks such as Emirates NBD and Emaar Properties tilted the index marginally lower.
Dividend hunting
Qatar Exchange ticked 0.5 per cent higher, driven by banking and industrial stocks with Qatar Navigation edging 0.4 per cent up, ahead of the dividend ex-date tomorrow which means today is the last day for investors to buy the stock to be eligible for the latest payout.
Kuwait premier index, Oman's 30-company index and Bahrain shares also rose all led by their financial stocks riding on the regional and global optimism.
