Lower Brent dents UAE stock market hopes

Brent fell to a six-month low of US$48.24 after Chinese data showed exports fell 8.3 per cent in July, before recovering to $48.85. Andrey Rudakov / Bloomberg

UAE markets were weak yesterday as equities came under pressure from low oil prices and a lack of positive sentiment.

Brent fell to a six-month low of US$48.24 after Chinese data showed exports fell 8.3 per cent in July, before recovering to $48.85.

The Dubai Financial Market General Index fell 0.7 per cent to close at 4,068.46 points.

Gainers for the index were the Islamic insurer Aman and Kuwait-based Hits Telecom, while Union Properties dropped 4.3 per cent to Dh1.11 on heavy volumes.

The developer of Motor City in Dubai on Sunday reported a 96 per cent drop in second-quarter net profit to Dh19.3 million.

Sanyalaksna Manibhandu, the chief equities analyst at National Bank of Abu Dhabi, said that the second-quarter earnings season was drawing to a close, with only a few companies left to report.

“Unless the corporate sector comes out with something that is surprisingly positive, the market will be focused on crude and macro themes, which do not appear supporting of equities for now,” he said.

On the regional scale, news that Saudi Arabia was seeking to raise funds from the domestic debt capital market was seen as a negative by some UAE traders.

With the kingdom raising debt capital, it could mean less system liquidity is allocated to equities in the country as well as for the wider GCC region, according to Mr Manibhandu.

In the capital, the Abu Dhabi Securities Exchange General Index climbed 0.2 per cent to 4,822.77 points. Abu Dhabi Ship Building rose 12.5 per cent, while Invest Bank fell 2.26 per cent.

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