By: Mahmoud Gamal
Dubai – Mubasher: The UAE stocks markets are seeing a historic period, as the national economy achieves positive results and companies report solid quarterly profits, analysts told Mubasher.
What is so interesting about the UAE markets is the wide gap between them, as the Dubai Financial market (DFM) faces semi-continuous decline, while the Abu Dhabi Securities Exchange (ADX) is going up most of the times, chief market analyst at Century Financial Brokers Vijay Valecha commented.
The real estate sector, which accounts for 40% of the DFM’s weight, went down, while the banks sector that makes up 55% of the ADX’s weight soared, Valecha added.
The DFM’s negative performance will not last long, as oil recovers due to many factors, among them OPEC output cut agreement, the decline in Venezuela’s oil production, and the geopolitical instability in Iran, the analyst said.
The good news for Dubai’s exchange is that Emaar Properties and Dubai Islamic Bank (DIB), which account collectively for approximately 35% of the market’s weight, are standing at attractive prices, he noted.
The listing of Saudi Arabia in Morgan Stanley emerging markets index will reflect a bright image of the Middle Eastern economies, Valecha continued.
Inflation in the UAE, which has resulted from the introduction of value-added tax (VAT) is expected to be eased gradually, a positive sign for the DFM, Valecha remarked.
Valecha stressed that major macroeconomic variables including inflation and interest rates can boost the UAE markets.
Translated by: Muhammad Khalid
