The UAE stock market gained nearly $3 billion(Dh11bn) in the last week of May and the increase allied with growth in Egypt's bourse to offset a decline in all other Arab exchanges, official figures showed yesterday.
The markets of Saudi Arabia and Kuwait, among the largest and busiest in the Middle East, were the main losers during the last business week of May, declining by more than $8bn, showed the figures by the Abu Dhabi-based Arab Monetary Fund (AMF), which tracks daily share moves in the Arab stock markets.
Most other bourses recorded declines as investors across the region completed quarterly profit taking and Arab markets started to lose steam ahead of the summer lull. The UAE's bourses of Abu Dhabi and Dubai, and Egypt's Cairo and Alexandria stock exchanges were the one odd out. Their growth was high enough to offset the decline in the market capitalisation of the other Arab bourses after several weeks of gains, according to the report.
At the end of the last working day of the month on Thursday, the combined Arab market capitalisation stood at about $1,359.5billion, slightly lower than that on May 22 of around $1,358.9 bn. A breakdown showed Abu Dhabi gained nearly $two bn from $124.05bn to $126.32bn during that period while Dubai's Securities Market grew by around $1bn from $137.58bn to $138.46bn.
This means the combined capitalisation of both markets added around $3 bn from $261.63bn to $264.78 bn. The increase extended a steady gain over the previous weeks as their collective market capitalisation stood at around $256.4bn at the start of May. Egypt's market capitalisation gained nearly $6bn to end the month at $153.32bn compared with $147.11bn a week earlier, according to the AMF, the Arab League's main financial institution. In contrast, the two other main Arab markets of Saudi Arabia and Kuwait declined through the week.
From $465.79bn on May 22, the market capitalisation of Saudi Arabia's Tadawul Exchange receded to nearly $461.60bn while Kuwait's capitalisation dropped from $210.70bn to $206.46bn. Other GCC markets also retreated albeit by a lower degree. Qatar's Doha Securities Market declined to $136.40bn from $137.21bn while Bahrain's bourse slipped to $29.62bn from $29.80bn and Oman's Muscat Securities Market to $28.68bn from $28.75bn. Other key bourses in the region emerged as losers including Jordan, which slipped to $50.20bn from $50.57bn and Lebanon, which slumped to $18.88bn from $18.94bn.
Dealers in the UAE expect regional markets to gradually lose momentum in the third quarter because of summer vacations before picking up in the last quarter of the year.
"There will be ups and downs during summer but most regional markets will be relatively calm during summer," said Ziad Dabbas, share dealing adviser at the National Bank of Abu Dhabi. "As for the UAE, you will see growth and declines in the coming months but this is normal as the market remains speculative.
"But generally, it will be better by the end of the year because speculation will be overshadowed by market fundamentals, mainly the strong performance of listed companies."