UAE bourses lead GCC recovery; market cap increases by Dh76B
dubai — The UAE and other major Gulf markets started the week on a higher note, helped by progress towards clinical trials of a potential treatment for coronavirus and bargain-hunting by investors.
Dubai and Abu Dhabi led the GCC recovery on Sunday after two consecutive days of declines last week as the combined market cap of the GCC bourses increased by $20.8 billion (Dh76.33 billion).
The Abu Dhabi Securities Exchange (ADX) saw its market cap rise by $3.31 billion while the Dubai Financial Market (DFM) jumped by $1.59 billion. Saudi Arabia’s Tadawul posted a $14.5 billion leap.
The DFM advanced 3 per cent, with Emirates NBD Bank up 3.7 per cent ahead of a board meeting to approve first-quarter earnings, while developer Emaar Properties also gained 3.7 per cent.
The ADX rose 2.9 per cent, boosted by a 4 per cent jump for the country’s largest lender, First Abu Dhabi Bank.
Devesh Mamtani, director for investment and advisory at Century Financial, said hopes of a Covid-19 treatment and early reopening of global economies from lockdowns spurred world indices higher on Friday and on Sunday GCC markets also rallied on improved risk sentiments.
“A report from Statnews indicated that University of Chicago Medicine studied 125 Covid-19 patients for Gilead’s two Phase 3 clinical trials in which all the patients were treated with daily infusions of Remdesivir. Even though 113 patients were considered as severe, there were only two fatalities which is great news. If safe and effective, Remdesivir could become the first approved treatment and this can trigger the policy makers to open their economy earlier,” said Mamtani.
On Friday, the Dow Jones rallied 3 per cent, the S&P 500 jumped 2.7 per cent and the Nasdaq advanced 1.4 per cent.
In Abu Dhabi, other big contributors were, Emirates Telecommunication and International Holdings. Dubai was also pulled up by Emirates Integrated Communications. International Holdings, which is a hot stock in the UAE, rallied by 9.76 per cent.
The Tadawul added 0.7 per cent as Al Rajhi Bank firmed by 0.6 per cent and Saudi Telecom registered a 1.4 per cent gain. Bahrain increased 0.6 per cent and Boursa Kuwait advanced 1.7 per cent. Qatar rose 0.5 per cent.
But Oman’s index bucked the trend and slipped 1.1 per cent.