Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
UAE retail investors continued to increase their exposure to software and AI infrastructure stocks in the last quarter despite the rise in geopolitical uncertainties in the region, according to data released by trading and investing platform eToro.
Quarter-on-quarter data on proportional change in holders of various global stocks on the eToro platform showed that investors sought to buy leading stocks during their dip in March.
Software and SaaS companies featured prominently among the top gainers in terms of investor holdings, suggesting that UAE investors used the sector-wide sell-off to accumulate positions. ServiceNow recorded the highest increase, with a 125% jump in holders, even as its share price declined by around 32% in the first quarter.
Adobe ranked third with a 54% increase in holders, despite its shares coming under pressure amid concerns about its ability to defend its core software business against AI disruption. The stock had fallen about 25% by mid-March, alongside news of a leadership change, indicating that investors were buying during the pullback.
AI infrastructure also emerged as a key investment theme during the quarter. Super Micro Computer saw a 65% rise in holders, followed by Micron at 39% and Oracle at 38%, as investors moved to capitalise on late-quarter declines in these stocks.
Micron stood out as an exception, with its stock price rising during the quarter, supported by strong demand for AI memory chips and limited new supply.
George Naddaf, Managing Director at eToro (MENA), said: “In Q1, UAE investors approached technology with selectivity and opportunism. Some of the companies that drew the strongest increase in holders had fallen to around 25% to 33%, suggesting investors were willing to buy into the sell-off where they still saw long-term value.”
He added: “Despite talk about the ‘Saaspocalypse’, the idea that AI will dismantle traditional SaaS business models, UAE investors showed sustained interest in software. They are homing in on companies that they believe have a clear role in the tech value chain and potential for monetisation. While geopolitical tensions added to market volatility, the pattern in holdings suggests UAE investors were driven more by sector conviction than by a broad risk-off mindset.”
Beyond technology, investors also increased holdings in companies across other sectors. e.l.f. Beauty saw a 52% rise in holders, while gains were also recorded in Duolingo, Gorilla Technology, Hims & Hers Health, and SoFi Technologies, reflecting interest in digital education, IT services, telehealth and fintech.
On the downside, Twist Bioscience Corporation recorded the largest drop, with a 90% decline in holders, followed by Okta at 49% and CoreWeave at 47%, indicating a selective approach among investors.
The list of most widely held stocks remained largely unchanged, underscoring continued investor confidence in major technology companies. NVIDIA retained the top position, while Amazon moved up to second and Microsoft to fourth, with Tesla and Apple slipping to third and fifth places, respectively.
Naddaf said: “Local investors’ selective approach to technology is further evidenced by the fact that AI and tech companies feature in both the risers and fallers lists. They appear to be making efforts to distinguish between the winners and laggards of the AI revolution.”
He added: “It suggests UAE investors are continuing to treat these names as core positions rather than short-term trades. NVIDIA held onto the top spot, while Amazon moved up to second and Microsoft climbed to fourth, but the ranking is largely unchanged.
"This points to continued conviction in mega-cap technology companies contributing to AI infrastructure and enterprise applications. In a quarter marked by uncertainty, that kind of stability points to a confidence in scale, earnings visibility, and relevance.”
