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The Abu Dhabi Securities Market General Index rose 1 per cent to 2586.75, led by Etisalat. Lee McGorie / The National.
The Abu Dhabi Securities Market General Index rose 1 per cent to 2586.75, led by Etisalat. Lee McGorie / The National.
The Abu Dhabi Securities Market General Index rose 1 per cent to 2586.75, led by Etisalat. Lee McGorie / The National.
Dubai stocks remained suppressed despite their early rise this morning. Lee McGorie / The National.
Dubai stocks remained suppressed despite their early rise this morning. Lee McGorie / The National.

Egypt fears continue to haunt UAE market rebound

CLOSING BELL: Markets rebound early on, but fears over Egypt suppress gains on the UAE's stock exchanges, with Dubai's markets losing out on the day's trading.- with video.

Traders said that fears about Egypt were suppressing a stronger recovery as markets rebounded amid speculation that dramatic fall in the UAE's bourses may have been overdone.

Hassan el Salah, head of institutional sales at AlRamz Securities, said that the markets had begun the day bouncing back after "panic" selling yesterday: "You saw a lot of sinking stocks yesterday, you saw a lot of them falling in value, and today we're seeing a rebound."

On Sunday, bourses in the Gulf plunged on fears of contagion from widespread unrest in Egypt, with the ADX falling 3.68 per cent to 2561.06 and the DFM down 4.32 per cent to 1543.02.

But today, the Abu Dhabi Securities Market General Index rose 1 per cent to 2586.75, led by Etisalat, which makes up one of the largest weightings in the index.

However, Dubai stocks remained suppressed despite their early rise, falling 0.56 per cent to 1534.40.

The telecoms company's shares were boosted 2.46 per cent to Dh10.40 per share after Prince Alwaleed bin Talal, the Saudi billionaire, made an offer to purchase

Zain's Saudi Arabian operations - a deal which traders saw as making more likely Etisalat's acquisition of Zain.

Etisalat's gain was one of the reasons that the ADX ended the trading session in positive territory, traders said. However, dedicated Middle Eastern fund managers were still waiting for clarity before jumping back into markets.

"It's a no-man's-land right now," said Fadi al Said, a fund manager at ING. "Nobody's making moves any until there's clarity on Egypt.

"Without Etisalat, Abu Dhabi would be in line [with Dubai]," he added. "A lot of institutional investors look to the region as homogenous - so when they decided to cut exposure to Egypt, they'll also cut exposure to the Gulf."

Worries about companies' exposure to Egypt roiled world markets opening today for the first time since the uprising began.

'After a weekend of deepening unrest in Egypt, the implications of the prevailing uncertainty have begun to broaden beyond Egypt's borders to many other regional bourses and even global commodity and equity markets," said Ann Wyman, head of emerging markets research at Nomura.

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