A.SREENIVASA REDDY (ABU DHABI)

UAE stock markets reopened on Wednesday after a two-day precautionary halt to trading amid regional developments.

Of the two markets, the Abu Dhabi Securities Exchange (ADX) withstood the negative trend with a loss of less than 2% in its main index. The Dubai Financial Market (DFM), however, took a bigger hit, with nearly a 5% decline in its benchmark index.

The Abu Dhabi Securities Exchange (ADX) General Index (FADGI) edged down 1.935% to close at 10,251.58, managing to stay above the 10,000 mark. Trading activity remained robust, with 25,433 trades involving 496 million shares valued at Dh1.373 billion. The total market capitalisation of ADX-listed stocks stood at Dh3.063 trillion.

Most blue-chip stocks declined during what was widely anticipated to be a stormy trading session.

Holding companies Alpha Dhabi and 2PointZero fell close to the maximum permitted limit, declining 4.93% and 4.52%, respectively.

Banking stocks also weakened, with First Abu Dhabi Bank declining 4.99% and Abu Dhabi Commercial Bank losing 4.88%. However, Abu Dhabi Islamic Bank stayed flat after declaring a dividend of 97.05 fils per share.Energy stocks also came under pressure.

ADNOC Distribution fell 5%, ADNOC Drilling slipped 2.54%, ADNOC Logistics and Services lost 4.93%, and ADNOC Gas declined 3.24%. Borouge recorded a marginal loss of 0.39%, while Fertiglobe bucked the trend and gained 2.61%.

Telecom giant e& followed the broader market trend and lost 4.83%.

Among the gainers was International Holding Company (IHC), which rose 1.1%, helping limit the decline in the main index. United Arab Bank (UAB) also bucked the trend, gaining 12.68%.

In Dubai, the Dubai Financial Market (DFM) General Index (DFMGI) fell 4.71% to close at 6,197.19. The session recorded 8,418 trades, with 165 million shares traded for a total value of Dh896 million. Market breadth showed one gainer, 52 decliners and three unchanged stocks.

Almost all major stocks — Emaar, Emaar Development, Emirates NBD, Dubai Islamic Bank, Salik, DEWA, Air Arabia and Talabat — fell close to 5%, the maximum permitted decline set by regulators for Wednesday’s trading.

UAE equities reopened under heavy selling pressure as investors rushed to price in heightened geopolitical risk, Milad Azar, Market Analyst at XTB MENA, said.

“Despite the two-day halt, pent-up orders drove sharp declines, particularly on the DFM, while the ADX showed relative resilience, holding above the 10,000 level,” Azar said.

Broad-based weakness across banking and energy stocks signals short-term risk aversion rather than fundamental deterioration, he added.

“Robust turnover and selective gains in IHC and UAB suggest liquidity remains intact. If regional tensions stabilise, bargain hunting could emerge, supported by solid macro fundamentals and dividend visibility,” Azar said.

Adam Vettese, Market Analyst at eToro, echoing Azar’s views, said: “The two-day trading halt helped prevent disorderly market conditions, but pent-up selling pressure was evident when trading resumed.”

“One notable exception was UAB, whose shares surged around 12% during the session, bucking the broader market trend following strong approval of its latest financial report,” Vettese said.

However, regional precedent may offer some reassurance.

“Saudi Arabia’s market remained open through the initial shock on Sunday, absorbed early losses and subsequently stabilised. Some investors may look for a similar pattern in the UAE, particularly given resilient economic fundamentals,” Vettese said.