Gulf bourses mixed on rate cut expectations, geopolitical tensions | Reuters

Gulf bourses mixed on rate cut expectations, geopolitical tensions | Reuters

Stock markets in the Gulf ended mixed on Thursday as the U.S. Federal Reserve signalling a possible start to interest rate cuts, while escalating tensions in the region weighed on investor sentiment.

The Federal Reserve committee's decision to hold rates at 5.25%-5.5% on Wednesday was no surprise, but it emphasised that rates would not be cut until it had more confidence that inflation was truly beaten.

At a press conference, Fed Chair Jerome Powell flatly stated a cut as early as March seemed unlikely, but also conceded that everyone on the committee was looking to ease this year.

Most Gulf Cooperation Council countries, including the United Arab Emirates (UAE), peg their currencies to the U.S. dollar and follow the Fed's policy moves closely.

Saudi Arabia's benchmark index (.TASI) gained 1%, snapping a three-day losing streak, with Al Rajhi Bank (1120.SE) advancing 2.4% and the country's biggest lender Saudi National Bank (1180.SE) closing 1.4% higher.

Elsewhere, oil giant Saudi Aramco (2222.SE) rose 1.3%.

Brent crude futures were up 68 cents at $81.23 a barrel by 1140 GMT.

The Qatari benchmark (.QSI) dropped 0.4%, hit by a 1% fall in Qatar Islamic Bank (QISB.QA) and a 2.1% decrease in Islamic lender Masraf Al Rayan (MARK.QA).

In the Middle East, worries over attacks by Yemen-based Houthi forces on shipping in the Red Sea are driving up costs and disrupting global oil trading. The Houthi group also said it would keep up attacks on U.S. and British warships in what it called acts of self defence.

In Abu Dhabi, the index (.FTFADGI) finished 0.4% lower, hit by a 3.7% slide in the UAE's biggest lender First Abu Dhabi Bank (FAB) (FAB.AD) despite a sharp rise in quarterly earnings.

FAB said net profit surged 63% to 4.01 billion dirhams ($1.09 billion) for the quarter ended Dec. 31, beating analysts' average estimate of 3.6 billion dirhams.

Dubai's main share index (.DFMGI) advanced 1.2%, with blue-chip developer Emaar Properties (EMAR.DU) rising 1.5%.

Outside the Gulf, Egypt's blue-chip index (.EGX30) added 0.5%.

The International Monetary Fund said on Wednesday it was making progress in talks with Egypt on how to resume disbursements of a $3 billion loan, after a sharp slide in the currency on the black market increased the urgency for an agreement.

BRICS Gets Boost as #SaudiArabia Joins Group of Emerging Nations - Bloomberg

BRICS Gets Boost as Saudi Arabia Joins Group of Emerging Nations - Bloomberg

South Africa’s foreign minister said Saudi Arabia and four other countries have accepted the invitation to join the BRICS club of nations that was extended during a summit last year.

Minister Naledi Pandor said that Russia, who takes over as chair of the bloc this year from South Africa, has received written interest from 34 countries who want to join. Saudi Arabia, Iran, Egypt, Ethiopia and the United Arab Emirates are now full members, she said.

“Argentina has written to indicate that they will not act on this successful application by the previous administration to become full members of BRICS and we accept their decision,” Pandor told a press briefing in the capital, Pretoria, on Wednesday.

Leaders from Brazil, Russia, India, China and South Africa agreed to enlarge their BRICS group from Jan. 1 at a summit held in Johannesburg in August.

BRICS foreign ministers are developing a so-called BRICS partner country model to accommodate 17 nations who were not accepted as full members, Pandor said.

The bloc is also devising a framework to allow members to use their local currencies for inter-BRICS trade. The minister said that the bloc found the current, predominantly dollar-based international payment system to be “unfair and costly.”

#UAE Sees Growing Interest From UK Fintech Firms for Dual Listings - Bloomberg

UAE Sees Growing Interest From UK Fintech Firms for Dual Listings - Bloomberg

The United Arab Emirates has seen a pick up in interest from a number of UK financial technology firms hoping to pursue a dual listing in the Gulf country, according to Economy Minister Abdulla bin Touq Al Marri.

The talks have accelerated after the two countries signed a memorandum of understanding in October to encourage cooperation in financial services, Al Marri said. They come as hundreds of financial services firms have set up operations in both Dubai and Abu Dhabi as they seek to take advantage of the country’s booming capital markets.

“I’m glad to see that the Gulf is a great opportunity for these,” Al Marri said in an interview with Bloomberg News. “The MoU is on track, we have a dedicated team to really look at the plumbing aspects, what can we do on aspects of dual listings.”

Al Marri was speaking at an event hosted by Investopia, a UAE-based platform launched by the minister and Sheikh Mohammed Bin Rashid Al Maktoum, the country’s vice president and the ruler of Dubai. Representatives from Abu Dhabi’s Mubadala Investment Co. as well as HSBC Holdings Plc and Citigroup Inc. were among those in attendance.

A potential pick up in dual listings would follow a booming year for initial public offerings in the Gulf. Listings in the Middle East raised more than $10 billion last year and Gulf countries accounted for about 45% of total IPO volumes in Europe, the Middle East and Africa.

UK companies aren’t alone in their interest in dual listings. Abu Dhabi Securities Exchange in November signed a deal with the New York Stock Exchange that allows companies listed on the NYSE to expand their business and tap capital in the emirate.

#Dubai Office Landlord Tecom to Expand as Middle East Hub Defies Property Slump - Bloomberg

Dubai Office Landlord Tecom to Expand as Middle East Hub Defies Property Slump - Bloomberg

One of Dubai’s largest office landlords is planning to expand its portfolio as the Middle East’s business hub continues to defy a global slump in commercial real estate.

Tecom Group, whose tenants include Meta Platforms Inc. and Alphabet Inc., is considering new developments as well as acquisitions to boost its portfolio, Chief Executive Officer Abdulla Belhoul told reporters, without disclosing details of how much the firm is looking to invest. The company, which reported a 49% increase in annual profit, is also planning to buy more land, he said.

An influx of businesses setting up in Dubai has boosted the city’s commercial real estate market and helped end a multi-year property slump. City-wide office occupancy rates are at an all-time high of 89%, according to real estate consultancy Cushman & Wakefield Core, stoking concerns of tight supply down the line.

That’s a stark contrast to major cities around the world where office landlords are being squeezed by a combination of higher borrowing costs and lower occupancy, as many companies continue to allow employees to work from home — at least part of the time.

For example, Brookfield’s tower in the heart of Dubai’s financial district has been one of their best performing assets globally at a time when other properties — including in Los Angeles and London’s Canary Wharf — have been hit by falling occupancy.

#Saudi central bank net foreign assets fell $1.09bln in December - data

Saudi central bank net foreign assets fell $1.09bln in December - data

Saudi central bank net foreign assets fell by $1.09 billion in December, central bank data showed on Wednesday.

The net foreign assets fell to 1.564 trillion riyals ($417.1 billion) in December from 1.568 trillion riyals in November, the data showed.

Net foreign assets were down 5.3% year-on-year in December.

#UAE's biggest bank FAB reports 63% jump in Q4 net profit

UAE's biggest bank FAB reports 63% jump in Q4 net profit

The UAE’s biggest lender First Abu Dhabi Bank (FAB) posted a Q4 2023 net profit of 4 billion dirhams ($1.09 million), up 63% year-on-year (YoY) as operating income grew due to business volumes and improved margins.

For FY 2023, the bank made a net profit of AED 16.4 billion, 22% higher YoY, or 56% higher on an underlying basis when excluding gains from the sale of stake in subsidiaries, according to the lender's statement on Thursday on Abu Dhabi's ADX exchange where its shares trade.

The quarterly profit far exceeded analysts’ mean estimates for both the quarter and the full year. For Q4 they had pencilled in AED3.67 billion, while for FY the estimate was AED15.3 billion, according to LSEG data.

Net interest income for Q4 was AED4.7 billion, up 12% YoY, as the benefits of higher benchmark rates kicked in. Net interest margin (NIM) was at 1.89% for the quarter.

For the fourth quarter, impairment charges were up 10%, mainly due to the downgrade of Egypt’s credit rating, the bank noted.

Lars Kramer, FAB Group CFO said: “These are a very strong set of results. Group revenue and net profit reached new record highs and performance was consistent across our core business segments... The strength of our franchise, rock-solid capital base, leading liquidity position, and high-quality risk profile, bolster confidence in our outlook for 2024 and beyond."

The lender's board has recommended a dividend payout of AED7.8 billion, representing 50% of the net profit. FAB termed this the "highest cash dividend payout since 2020."

Mideast Stocks: Major Gulf markets gain, helped by rate cut expectations

Mideast Stocks: Major Gulf markets gain, helped by rate cut expectations

Major stock markets in the Gulf rose in early trade on Thursday, helped by signals from the U.S. Federal Reserve about a possible path to rate cuts, although the Abu Dhabi index bucked the trend.

The Federal Reserve committee's decision to hold rates at 5.25%-5.5% on Wednesday was no surprise, but it emphasised that rates would not be cut until it had more confidence that inflation was truly beaten.

At a press conference, Fed Chair Jerome Powell flatly stated a cut as early as March seemed unlikely, but also conceded that everyone on the committee was looking to ease this year.

Most Gulf Cooperation Council countries, including the UAE, peg their currencies to the U.S. dollar and follow the Fed's policy moves closely.

Saudi Arabia's benchmark index gained 0.7%, on course to snap a three-day losing streak, with Al Rajhi Bank gaining 1.3% and the country's biggest lender Saudi National Bank rising 1.1%.

Among other gainers, oil giant Saudi Aramco was up 0.8%.

Dubai's main share index rose 0.6%, with blue-chip developer Emaar Properties gaining 1.1% and Commercial Bank of Dubai jumped 10% on upbeat annual earnings.

The lender reported full-year net profit of 2.65 billion dirham ($721.6 million), beating market estimates of 2.49 billion dirham.

The Qatari benchmark index edged 0.1% higher, with the Gulf's biggest lender Qatar National Bank adding 0.5%.

In Abu Dhabi, the index, however, bucked the trend to fall 0.5%, hit by a 3.3% slide in First Abu Dhabi Bank despite reporting a sharp rise in annual profit.

FAB, the UAE's biggest lender by assets, said net profit surged 63% to 4.01 billion dirhams for the quarter ended Dec. 31, beating average analysts' expectations of 3.6 billion dirhams.