UAE shares fell yesterday as lower oil prices and the summer lull weighed on sentiment.
China’s currency devaluation last week and the expectation that the US Federal Reserve will raise interest rates next month have also spurred investor caution about risky assets.
The Abu Dhabi Securities Exchange General Index dipped 0.8 per cent, dragged lower by FGB, the emirate's biggest lender by market value, and Aldar Properties, the capital's biggest listed developer.
In Dubai, the benchmark index closed down 0.1 per cent as Emaar Properties, the UAE's largest developer by market value, declined.
“First of all, we are in the [middle of] summer and given that the oil price is low, this has not given investors a reason to invest,” said Sherif Salem, a portfolio manager at Abu Dhabi Investment Company.
“It has made investors wary. Given that second-quarter results are out of the way, there are not a lot of catalysts and there is no real reason to rush into putting money into the markets.”
Oil has lost more than half of its value over the past year amid waning demand from China and rising supply from North America.
Crude futures slid 1.7 per cent to US$41.80 a barrel in New York yesterday.
The UAE funds more than 60 per cent of its federal budget from the sale of crude oil, and the country's economic growth is expected to slow as a result of the oil slump.
Elsewhere, Saudi Arabia’s main index edged down 0.3 per cent to 8,426 points but closed well off its intra-day low of 8,381 points.
Egypt’s bourse closed 0.4 per cent lower at 7,594.05 points, trimming losses after it rebounded from technical support near its July low of 7,527 points.
mkassem@thenational.ae
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