x Abu Dhabi, UAESaturday 22 July 2017

UAE markets on the up as banking stocks set the pace

Markets Update: First Gulf Bank's shares soar after a huge dividend for shareholders is announced.

Stocks on the Abu Dhabi Securities Exchange snapped a six-month losing streak in January, following announcement of a Dh1.5bn dividend payout at First Gulf Bank which sent shares soaring.

The capital’s stock market rose 2.1 per cent during January, the first time it has done so since June. Dubai’s stock market soared to its highest level since September, capping the best month for the emirate’s market since March.

The index rose 6 per cent during the month, having rallied sharply after tension between Iran and the US subsided.

Today’s performance ended the month on a high note, with the Dubai Financial Market General Index rising 2.1 per cent to 1,435.72 while the Abu Dhabi Securities Exchange General Index climbed 1.3 per cent to 2,453.98. The capital’s index moved higher after First Gulf Bank’s shares jumped 9.9 per cent to Dh17.15 each.

The Dh1.5bn payout at the bank and the resumption of dividend payments for the first time since 2008 at Abu Dhabi Commercial Bank had jumpstarted local markets, said Ali Khan, head of Mena equity sales at Royal Bank of Scotland.

“ADCB and First Gulf Bank are reinvigorating investor interest in the short-term, led by what’s happening on the dividend side,” he said.

In Dubai, sharp gains for big lenders including Emirates NBD and Dubai Islamic Bank led the market higher as retail investors anticipated higher dividends to come.

Emaar Properties, Arabtec and du also rose, while Dubai Financial Market Company made gains as volumes improved on the emirate’s market.

S&P 500 futures rose slightly, pointing to a higher open on Wall Street after a strong start to the trading day in Europe.
Oil prices also rose sharply as signs of progress emerged in talks between European leaders over Greece’s debts. Brent crude futures rose $1.44 to $111.91 per barrel.

ghunter@thenational.ae