UAE indexes end in negative on global cues
Stock exchanges in Dubai and Abu Dhabi closed in negative territory yesterday, reflecting a slump in global stocks and oil prices due to increasing trade tensions.
Markets in the rest of the region were closed because of the Eid holiday, which started last week.
US President Donald Trump announced tariffs on Chinese imports, prompting Beijing to respond with similar measures.
Global stocks were down yesterday and oil prices came under pressure, in particular after China threatened duties on American crude imports.
In Dubai, where the index dropped 1.8 per cent to 2,983 points, the worst performer was Air Arabia, which lost 7 per cent and saw the highest trading volume in Dubai yesterday.
The low-cost carrier said it has invested in Abraaj funds, without giving details on its exposure to the private equity group which last week filed an application for provisional liquidation. The founder of Abraaj is a board director of the airline, which said it has appointed a team who are “actively engaged with all stakeholders and creditors involved with the matter to ensure Air Arabia’s investment and business interest is protected”.
The Abu Dhabi index lost 2.7 per cent to 4,588 points, with stocks in financial institutions mostly down. Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Union National Bank and heavyweight First Abu Dhabi Bank all closed in negative territory.
The only exception was National Bank of Fujairah, which outperformed the market soaring 13.4 per cent. Its chief executive told The National last week that the bank plans to set up a debt programme and become a regular borrower to fund its growth.
Investment company Waha Capital dropped 4.5 per cent.
Sources told Reuters last week that the Abu Dhabi firm had abandoned plans to raise a $300 million private equity fund, as investor demand for Middle East private equity funds has been hurt by a crisis of confidence at the region’s biggest buyout firm, Abraaj, which is battling allegations it misused funds.
Gold yesterday held close to five-and-a-half month lows, with a strong dollar offsetting the impact on prices of an escalating trade dispute between the US and China.