Dubai: UAE stocks posted a second straight session of gains as governments continued to take colossal strides to help keep their economies afloat amid a ravaging pandemic and a slump in oil prices.
Dubai Financial Market (DFM) index were up 4.2 per cent at 1,906 points, after rising nearly as much on Friday. Abu Dhabi Securities Exchange (ADX) rose over 2 per cent to 4,200 points, after gaining over 6 per cent during the previous session.
Both UAE bourses saw real estate firms and lenders gaining across the board.
In Dubai, property giant Emaar Properties rallied 5.5 per cent, while its two related entities rose over 4 per cent. Lenders Emirates NBD and Dubai Islamic Bank too posted similar sized gains.
In Abu Dhabi, shares of banks ADCB and FAB jumped by over 5 per cent and nearly 2 per cent respectively. Aldar Properties gained 2.67 per cent.
In efforts to resuscitate economies reeling from the effects of a rampaging COVID-19 crisis, Abu Dhabi launched a $7 billion bond issue last week and elsewhere in the world’s top economy, the US Federal Reserve announced a $2.3 trillion effort to support small to medium-sized businesses.
“Governments elsewhere in the Gulf are likely to follow Abu Dhabi with dollar bond sales in the coming months as they look to secure funds in the face of low oil prices,” noted Jason Tuvey, senior emerging markets economist at Capital Economics.
Most regional indices also traded higher. While Boursa Kuwait was up 0.5 per cent, Bahrain Bourse and Oman’s Muscat Securities Market edged up marginally. However, Saudi Arabia’s Tadawul was down 1 per cent and Qatar was down by 0.22 per cent.
The price of Brent crude fell nearly 2.5 per cent to $31.82 per barrel on Friday, despite news that the oil cartel and allies – known as Opec+ – had reached a deal that would end a price war between Saudi Arabia and Russia that threatened to flood the market with more oil than the world could use.
Oil prices will remain pressured as the deal hangs in the balance with no proper consensus among the partners. Traders also fear that an Opec deal to slash global supplies by 10 per cent would not offset a historic drop in demand due to the coronavirus outbreak.