Friday 31 December 2010

UAE’s Stock Market Merger Ensnared by Politics, Technical Problems

Trading volumes are a fraction of what they were just two years ago, and broker-dealers are closing up shop for lack of business. But a merger of the three stock exchanges of the United Arab Emirates (UAE), a move that could solve many of these woes in one stroke, remains entangled in politics and technical problems.

While stock market trading across the Middle East has dropped off sharply with the onset of the global financial crisis, figures from the Arab Monetary Fund (AMF) released Thursday show that two of the UAE’s bourses shrunk the most last year: Volume on the Dubai Financial Market (DFM) plunged 61% this year and on the Abu Dhabi Securities Exchange (ADX) by 51% through December 29.

Only Nasdaq Dubai, which isn’t included the AMF figures, showed some improvement this year, with the value of securities traded reaching $1.2 billion in the first 11 months, compared with $1.08 billion for all of 2009.

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