Regional markets push higher on signs that recession may be easing

Abu Dhabi's benchmark index climbed to a four-month high yesterday, while measures in five other gulf markets advanced on signs the global recession is easing. Strong results from banks in Oman and Qatar also helped push regional markets higher. "We are seeing markets close higher with increased volumes because we have got global and regional catalysts in terms of international market performance as well as positive quarterly earnings coming through from locally listed companies," said Ali Khan, the managing director of Arqaam Capital. "Volumes continue to remain healthy as local and international liquidity re-enter the market."

The Abu Dhabi Securities Exchange General Index rose 1.26 per cent to 2,679.77 and the Dubai Financial Market index gained 1.43 per cent to 1,712.37, following gains on Wall Street on Wednesday. "Snippets of data indicating that western economies may be seeing the first glimpse of a recovery are keeping the rally going in our markets and encouraging investors not to sell prior to first-quarter earnings releases," said Matthew Wakeman, a markets commentator at EFG Hermes.

On the Abu Dhabi market, Aldar Properties, the emirate's top property developer by market value, gained for a third trading session as consulting firm Jones Lang LaSalle said the emirate may be the region's best-performing property market in the next year to two years. Aldar rose 2.83 per cent to Dh4 and Sorouh Real Estate advanced 2.47 per cent to Dh2.90, its highest close in three months. "Real estate stocks continue to perform well as banks become more accessible to borrowers again," said Mr Wakeman. "Cityscape Abu Dhabi, which starts on Sunday, is also providing support for Aldar and Sorouh, given the different demand picture in Dubai."

Property and construction firms in Dubai also witnessed gains, with Emaar rising 6.45 per cent to Dh2.64 and Union Properties gaining 1.09 per cent to Dh0.92. "Even now, despite the recent run-up we have had in the property market, the movement of certain stocks is significant as those valuations are not viewed as particularly expensive," said Mr Khan. Financial services stocks also climbed, with Shuaa Capital rising 4.62 per cent to Dh1.13 on the Dubai market following confirmation that the firm's operations would continue after shareholders demonstrated support at an extraordinary general meeting on Wednesday.

Gains were seen across the Gulf, with the Qatari exchange advancing 2.78 per cent to 5,379.49 "There are some good results coming out of Qatar, especially among the banks," Julian Bruce, the director of institutional equity sales at EFG Hermes, told Bloomberg. Foreign institutional investment in Qatari stocks is increasing, "especially in the large caps and that is now starting to spill over into the UAE as well".

"Doha Bank numbers were very, very good and financials in Qatar and Saudi Arabia continue to come in with encouraging numbers," said Mr Khan. Doha Bank added 8.2 per cent to 34.5 riyals, the most since Nov 2. The bank's first-quarter profit rose to 329.7 million Qatari rials (Dh332.6m) as it focused lending to small and medium-sized companies. Kuwaiti stocks rose 0.84 per cent to 7,417.8 and Muscat's exchange gained 2.95 per cent to 5,209.74. Bahrain's All Share Index rose 0.7 per cent to 1,674.45.

* with Bloomberg shamdan@thenational.ae See more markets coverage, b10

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RESULT

Bayer Leverkusen 2 Bayern Munich 4
Leverkusen: Alario (9'), Wirtz (89')
Bayern: Coman (27'), Goretzka (42'), Gnabry (45'), Lewandowski (66')

School counsellors on mental well-being

Schools counsellors in Abu Dhabi have put a number of provisions in place to help support pupils returning to the classroom next week.

Many children will resume in-person lessons for the first time in 10 months and parents previously raised concerns about the long-term effects of distance learning.

Schools leaders and counsellors said extra support will be offered to anyone that needs it. Additionally, heads of years will be on hand to offer advice or coping mechanisms to ease any concerns.

“Anxiety this time round has really spiralled, more so than from the first lockdown at the beginning of the pandemic,” said Priya Mitchell, counsellor at The British School Al Khubairat in Abu Dhabi.

“Some have got used to being at home don’t want to go back, while others are desperate to get back.

“We have seen an increase in depressive symptoms, especially with older pupils, and self-harm is starting younger.

“It is worrying and has taught us how important it is that we prioritise mental well-being.”

Ms Mitchell said she was liaising more with heads of year so they can support and offer advice to pupils if the demand is there.

The school will also carry out mental well-being checks so they can pick up on any behavioural patterns and put interventions in place to help pupils.

At Raha International School, the well-being team has provided parents with assessment surveys to see how they can support students at home to transition back to school.

“They have created a Well-being Resource Bank that parents have access to on information on various domains of mental health for students and families,” a team member said.

“Our pastoral team have been working with students to help ease the transition and reduce anxiety that [pupils] may experience after some have been nearly a year off campus.

"Special secondary tutorial classes have also focused on preparing students for their return; going over new guidelines, expectations and daily schedules.”

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”