Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
UAE stock markets retreated on Thursday after recent gains made in the wake of easing geopolitical tensions in the region. Profit-booking, fears over a US Federal Reserve interest rate hike and concerns over an “AI bubble” appeared to hold back momentum in the UAE markets.
Reuters, in its daily report, said Gulf stock markets also came under pressure due to falling oil prices.
The ADX General Index (FADGI) fell 1.174% to close at 9,876.06. Trading activity remained strong, with 28,466 trades involving 382 million shares valued at Dh1.74 billion. The total market capitalisation of ADX-listed stocks stood at Dh2.898 trillion.
Almost all blue-chip stocks traded lower, with some reporting substantial declines.
Among banking stocks, Abu Dhabi Islamic Bank lost 3.83%, while First Abu Dhabi Bank dropped 3.15%. Abu Dhabi Commercial Bank slipped 2.39%.
ADNOC-linked stocks also came under pressure even as Abu Dhabi allocated one of the largest natural gas concessions to the state-run company. ADNOC Logistics and Services was down 1.17%, while ADNOC Gas traded flat at Dh3.43. ADNOC Drilling dropped 1.19%, while ADNOC Distribution slipped 1%. Borouge dropped 0.78%, while Fertiglobe slipped 1.06%.
Holding company Alpha Dhabi dropped 1.23%. Another holding company, 2PointZero, lost 2.2%.
Realty giant Aldar also followed the broader market trend, dropping 3.93%.
In Dubai, the Dubai Financial Market General Index (DFMGI) fell 1.43% to close at 6,024.59. The session recorded 17,319 trades, with 237 million shares changing hands for a total value of Dh1 trillion. Market breadth remained negative, with seven gainers, 35 decliners and 10 stocks unchanged.
Real estate heavyweights Emaar and Emaar Development led the market fall, with the former losing 2.86% and the latter dropping 1.41%.
Emirates NBD lost 1.30% and Dubai Islamic Bank dropped 1.97%, adding to the downward trend.
Utility provider DEWA dropped 4.12%, while road toll operator Salik lost 1.66%.
Recent weakness in UAE equities appears driven more by sentiment and positioning than by a deterioration in fundamentals, said Milad Azar, Market Analyst at XTB MENA.
“After the strong rebound following easing geopolitical tensions, profit-taking was expected, while renewed concerns over US interest rates and technology valuations encouraged investors to reduce risk exposure,” Azar said.
Strong trading volumes suggest participation remains healthy despite the broad-based decline, Azar noted.
“The pullback could prove temporary if oil prices stabilise and US rate expectations become clearer,” Azar said.
Banking, real estate and ADNOC-linked stocks faced pressure, but their underlying fundamentals remain relatively resilient, Azar said. “Investors may view current levels as an opportunity to selectively accumulate quality stocks,” Azar said.
