ADX slips 0.9% after EFG Hermes cuts ADCB rating
Abu Dhabi's benchmark declined to the lowest in nearly three months, after Abu Dhabi Commercial Bank was cut to "neutral", from "buy" at EFG Hermes.
ADCB shares were down 4 per cent to Dh3.07 at 2pm.The Abu Dhabi Securities Exchange General Index was down 0.9 per cent to 6439.08 points, the lowest since March 31.
The bank agreed to sell its 25 per cent stake in Malaysia's RHB Capital to Abu Dhabi's Aabar Investments for about 5.9 billion ringgit, equivalent to $1.9 billion. The bank said it will earn about 1 billion dirhams from the sale.
The Dubai Financial Market General Index added 0.3 per cent to 1,578.45 points.
MSCI will announce at 1am local time whether it considers the UAE an "emerging market". The index company currently categorises the UAE as a "frontier" market. An upgrade could attract new liquidity to the country's bourses and drive index fund investment, which has steadily declined in recent years.
The UAE has "solved most of the issues mentioned by MSCI," Joe Kawkabani, the chief investment officer of equities at Franklin Templeton Investments told Bloomberg.
"If the UAE becomes part of the MSCI emerging- markets index, it would have a very small weighting because of the foreign ownership limits. It's still a big positive as it puts the UAE on additional radar screens for investors," Kawkabani added.
The value of stocks traded on UAE bourses is Dh36 billion so far this year. At that rate, the value of total trading would be about Dh70bn at the end of the year. In 2008, trading on the bourses was worth Dh530bn.
Published: June 22, 2011 04:00 AM