Mideast Stocks: UAE Stock Markets Up On Rising Oil Price, Rate Cheer
Stock markets in the United Arab Emirates closed higher on Friday on rising oil prices and after the Federal Reserve indicated earlier in the week it is likely to cut borrowing costs next year. Oil prices, a major driver for Gulf economies, were on track to notch up their first weekly rise in two months after a bullish forecast from the International Energy Agency (IEA) on oil demand for next year, with Brent futures rising 23 cents to $76.84 a barrel at 1123 GMT.
The U.S. Federal Reserve left interest rates unchanged on Wednesday and U.S. central bank chief Jerome Powell said the historic tightening of monetary policy is likely over as inflation falls faster than expected. Monetary policy in the six-member Gulf Cooperation Council (GCC), including the United Arab Emirates, is usually guided by Fed policy decisions because most regional currencies are pegged to the U.S. dollar. In Dubai, the main share index rose 0.5%, in its fourth positive session in a row, led by solid gains in financial stocks, with Emirates NBD Bank, Dubai’s largest lender inching up 1.5% and Dubai Investments climbing 3.6%. The index notched up a 1.25% weekly gain after a third consecutive weekly loss. Abu Dhabi’s index added 0.2%, bolstered by a nearly 2% hike in Abu Dhabi Commercial Bank.
The lender on Thursday said it sold its 80% stake in Abu Dhabi Commercial Properties (ADCP) to Nine Yards Plus Holding in a deal valued at 591 million dirhams ($160.94 million) First Abu Dhabi Bank, the United Arab Emirates’ biggest lender, was up 0.9%. Elsewhere, Abu Dhabi National Oil Co (ADNOC) is closing in on a deal with Austria’s OMV to combine two entities in which the companies own stakes to create a chemicals giant, two people with knowledge of the talks said.
In July, OMV said it had entered into talks to merge petrochemicals group Borealis – which is owned by OMV and ADNOC in a 75:25 split – and Borouge, which is 54:36 owned by ADNOC and Borealis. Bourouge shares were down 0.4%. The index recorded a 1.03% weekly gain following three weekly declines. ABU DHABI rose 0.2% to 9,498 DUBAI was up 0.5% to 4,001 ($1 = 3.6721 UAE dirham) (Reporting by Shamsuddin Mohd in Bengaluru;Editing by Elaine Hardcastle)
