UAE stocks continued to rise yesterday, helped by prospects of further interest rate cuts by the US Federal Reserve. The Dubai bourse rose 39.34 points or 0.7 per cent to close at 5,533.54 while Abu Dhabi's measure added 0.3 per cent at 4,585.40 points.
Since January 15, however, the Dubai Financial Market (DFM) General Index slumped 12 per cent and the Abu Dhabi Securities Market (ADSM) Index, seven per cent, mainly due to the offloading of UAE shares by foreign investors to make up for losses in the global markets, particularly the US.
Most regional currencies have been gaining sharply against the dollar following the Fed's 75-basis point cut in benchmark interest rates last week and expectations of another cut this week. Lower interest rates in the US - which were done to ward off a recession due to the recent subprime mortgage crisis - drive out global investors to higher-yielding assets in emerging markets such as those in the Middle East and Asia.
DFM Co, the Middle East's only publicly traded stock exchange, paced the Dubai measure with shares value of Dh434.9 billion. Its shares rose 3.3 per cent from Dh5.26 to Dh5.37. Dubai Islamic Bank (DIB) also led the measure's advance with a jump of 3.4 per cent from Dh10.30 to Dh10.65. Source
Since January 15, however, the Dubai Financial Market (DFM) General Index slumped 12 per cent and the Abu Dhabi Securities Market (ADSM) Index, seven per cent, mainly due to the offloading of UAE shares by foreign investors to make up for losses in the global markets, particularly the US.
Most regional currencies have been gaining sharply against the dollar following the Fed's 75-basis point cut in benchmark interest rates last week and expectations of another cut this week. Lower interest rates in the US - which were done to ward off a recession due to the recent subprime mortgage crisis - drive out global investors to higher-yielding assets in emerging markets such as those in the Middle East and Asia.
DFM Co, the Middle East's only publicly traded stock exchange, paced the Dubai measure with shares value of Dh434.9 billion. Its shares rose 3.3 per cent from Dh5.26 to Dh5.37. Dubai Islamic Bank (DIB) also led the measure's advance with a jump of 3.4 per cent from Dh10.30 to Dh10.65. Source
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