#UAE markets gain on rate cut bets | Reuters

UAE markets gain on rate cut bets | Reuters

UAE stock markets closed higher on the last trading day of 2023, with the Dubai index rising for a third year on expectations for interest rate cuts in 2024.

Dubai's benchmark index (.DFMGI) gained 0.3% on Friday, lifted by a 1.3% rise in toll operator Salik Company (SALIK.DU), while top lender Emirates NBD Bank increased 0.9%.

The Dubai index, which hit its highest in nearly eight years in early October, finished the year 21.8% higher.

It was supported by gains in heavyweight real estate and banking sectors in 2023, as blue-chip developer Emaar Properties (EMAR.DU) ended the year up 35.2% and Emirates NBD 33.1% higher.

The Dubai market gained strongly during the first half of the year, but steadied and then retreated in reaction to the flare-up in geopolitical tensions in the region, said Abdelhadi Laabi, chief marketing officer at KAMA Capital. However, "the market was able to recover a significant part of its losses, returning to an uptrend".

Abu Dhabi's main index (.FTFADGI) edged up 0.1% in a volatile session on Friday, supported by a 4.8% surge in state-run utility Abu Dhabi National Energy Company (TAQA.AD) and a 2.2% jump in conglomerate International Holding Company (IHC) (IHC.AD).

The Abu Dhabi index fell 6.2% for the year, breaking a two-year winning streak, with the first quarter seeing the highest losses for nine years, according to LSEG data.

IHC, the UAE's most valuable listed firm, fell 2.6%, its first annual loss in five years, while top lender First Abu Dhabi Bank dropped (FAB.AD) 18.4%, extending losses to second year.

"The Abu Dhabi stock market was more volatile than its (Dubai) counterpart and was affected by the uncertainty and rapid changes in the oil markets' conditions," Abdelhadi said.

Expectations for softer U.S. monetary policy could fuel risk appetite, lower financing costs and boost UAE stocks in 2024, Abdelhadi added.

Monetary policy in the six-member Gulf Cooperation Council is usually guided by the U.S. Federal Reserve's decisions, as most regional currencies are pegged to the dollar.

Oil prices - a key contributor to Gulf economies - ended 2023 about 10% lower after two years of gains, as geopolitical concerns, production cuts and central bank measures to rein in inflation triggered big fluctuations in prices.

On Friday, Brent crude was up 0.7% to $77.67 a barrel at 1203 GMT.

Norwegian Pension Fund KLP Blacklists #Saudi Aramco, Other Gulf Companies - Bloomberg

Norwegian Pension Fund KLP Blacklists Saudi Aramco, Other Gulf Companies - Bloomberg

Norway’s largest pensions’ manager divested $15 million from Gulf companies on concerns they may facilitate human rights violations, and decided to exclude Saudi Aramco because of climate risks.

KLP, which oversees $70 billion, blacklisted a dozen companies listed in Saudi Arabia, Qatar, the United Arab Emirates and Kuwait from its investment universe. The divestments mostly reflect an “unacceptable” risk of contributing to human rights abuses, KLP said, with Aramco targeted separately for its negative impact on the environment.

The excluded firms included companies in the real estate sector, where KLP says migrant workers from Africa and Asia have faced discrimination and human rights violations. The pension fund also targeted the telecommunications sector, where it cited the development of artificial intelligence as reinforcing the risk of surveillance and censorship in the region.

“Gulf states remain characterized by authoritarian systems of government that restrict freedom of expression and political rights, including of critics and human rights activists,” said Kiran Aziz, KLP’s head of responsible investment, in a statement.

The stocks which were blacklisted were mixed on Thursday, with some trading higher along with emerging-market peers, while others slipped. Aramco edged lower, tracking an overnight drop in oil. Foreign investors generally have a smaller exposure to Gulf markets — which comprise just over 7% of the MSCI Emerging Markets Index — due to smaller free floats and more recent inclusions to the benchmark.

#UAE's e& ends talks to hike stake in #Saudi telco Mobily | Reuters

UAE's e& ends talks to hike stake in Saudi telco Mobily | Reuters

The United Arab Emirates telecoms group e& (EAND.AD) said on Friday it had ended talks to raise its stake in Saudi Arabia's Etihad Etisalat (Mobily) (7020.SE) to 50% and one share (7020.SE).

"Emirates Telecommunications Group Co e& has terminated discussions regarding a possible increase in its shareholding in Mobily," e& said in a company filing on the Abu Dhabi exchange.

"Following a period of engagement, a way forward to conclude the potential transaction could not be determined. Hence, e& has now decided not to pursue the financial transaction."

Formerly called Etisalat, e& is Mobily's biggest shareholder with a 27.99% stake. In March last year, e& made the offer to raise its stake and suggested a price of 47 riyals ($12.53) per share.

E& said it will continue to focus on supporting Mobily as its major shareholder and remains positive about the company's future within the rapidly growing Saudi market.

#UAE's #AbuDhabi sees non-oil GDP growth of 7.7% in Q3 2023 -statement | Reuters

UAE's Abu Dhabi sees non-oil GDP growth of 7.7% in Q3 2023 -statement | Reuters

United Arab Emirates' capital Abu Dhabi posted third-quarter non-oil gross domestic product (GDP) growth of 7.7%, the government media office reported on Friday citing the emirate's statistics agency.

The emirate registered overall economic growth of 1% in Q3 year on year, according to preliminary estimates released by the Statistics Centre-Abu Dhabi (SCAD) to reach 290.5 billion dirhams ($79.11 billion).

Abu Dhabi registered 2.8% growth in real GDP over the first nine months of 2023 compared to the same period a year prior and 8.6% growth in non-oil activities.

Lower production and oil prices this year have weighed on overall growth but Gulf states have all stepped up efforts to diversify their economies and income sources away from hydrocarbons to plan for more sustainable growth in the long term.

Abu Dhabi holds the vast majority of the OPEC member's oil reserves but has accelerated the development of sectors such as manufacturing and tourism.

Non-oil activities account for more than 50% of the emirate's overall economy, with manufacturing contributing 17% to non-oil GDP in Q3 and 9% to its overall GDP.

Foreign investment into Abu Dhabi grew by 9.7% in 2022, according to SCAD data, to reach more than 831 billion dirhams.