UAE stocks feel heat of US-China tensions

Dubai’s main index fell almost 1.5 per cent to 2,939 points yesterday as concerns over trade tensions between the United States and China ricocheted through emerging markets.

Asian stocks wilted to a four month low with a nearly 4 per cent drop in Chinese stocks as China warned it would retaliate to a threat of new US tariffs on Chinese goods.

Property and banking shares dragged down Dubai’s main index as the exchange’s biggest developer Emaar Properties plunged 5.2 per cent.

The Dubai real estate sector has been a drag on the exchange this year with analysts expecting weak property values to fall further on excess supply. Lenders Dubai Islamic Bank and Emirates NBD fell 0.8 per cent and 1 per cent, respectively.

Budget airline Air Arabia ended flat after shedding 7 per cent on Monday over concerns of its investment in embattled Middle East private equity company The Abraaj Group. Air Arabia said on Monday it had invested in Abraaj funds but did not disclose its exposure to the group which last week filed for provisional liquidation.

Abu Dhabi’s index shed 0.6 per cent to 4,562 points with the UAE’s largest lender First Abu Dhabi Bank losing 0.8 per cent and weak oil prices hurt energy stocks including Abu Dhabi National Energy Company (Taqa) which plunged 4.1 per cent.

Oil prices fell yesterday as an escalating trade dispute between the US and China triggered sharp sell-offs in many global markets.

In Egypt, the main index fell 0.9 per cent to 16,068 points as Commercial International Bank lost 3.1 per cent and conglomerate Talaat Mostafa Group was down 1.7 pe rcent.

Saudi Arabia, the region’s biggest stock market, and Qatar are closed for holidays.

The Oman index fell 0.2 per cent 4,589 points.

Gold fell to its lowest in nearly six months on Tuesday as a higher dollar and a technical sell-off overwhelmed safe-haven buying spurred by fears of a trade war between the world’s top two economies.

Spot gold fell 0.3 percent at $1,274.31 an ounce by 13.35 GMT, having touched its lowest since December 22 at $1,270. US gold futures for August delivery were 0.2 per cent lower at $1,277.20 per ounce.