Dubai – Mubasher: The UAE’s two stock markets are expected to perform positively in June on the back of new government decisions including the transfer of settlements for both the Dubai Financial Market (DFM) and the Abu Dhabi Securities Exchange (ADX) to the Central Bank of the UAE (CBUAE).

Another decision that is likely to bolster trading and gains in the bourses is the transformation of the Abu Dhabi Investment Council (ADIA) into a public shareholding company under Mubadala, analysts told Mubasher.

On Thursday, which marked the last trading session in May, the DFM registered a 3.32% drop, shedding over 100 points over the course of the month, and closed at 2,964.13 points, pressured by banks and real estate, while the ADX tumbled 1.38% to 4,605.04 points, weighed by telecom and real estate stocks.


Optimistic factors

There are several factors that call for optimism in UAE trades, commented NamaaZone CEO Iyad Aref, indicating the government’s decision to raise foreign ownership in some UAE-based companies to 100% from 49% as well as the offering of long-term visas, of up to 10 years, to some foreign investors and specialists.

The decision to transform ADIA into a Mubadala-managed firm will attract a lot of liquidity and foreign investments to the markets, in addition to bolstering confidence, Aref told Mubasher.

Meanwhile, Issam Kassabieh, senior financial analyst at MenaCorp, forecast a rebound in UAE indices on the back of such positive news. June will be distinct, as it coincides with companies’ profit guidance projections ahead of publishing results for the first half of 2018.

The rise in oil prices to around $80 per barrel will likely boost markets in the coming period, Kassabieh said, adding that upgrading Emaar Development’s stock on the MSCI Emerging Markets Index will prompt some selective purchases for low-level-priced stocks.

Translated by: Nada Adel Sobhi

Source: Mubasher Exclusive

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