UAE Stocks Continue to Fall

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The UAE and Arabian Gulf markets at large have seen stocks fall amidst falling Chinese equities and on-going low oil prices. There is also uncertainty in the market as the world looks on to the United States, as it decides on the interest rate later this week.

Majority of the Asian stocks fell yesterday once the Shanghai Composite Index closed at 2.6%, after the release of discouraging production dates from the Chinese industrial sector for the month of August.

Japan’s Nikkei also lost 1.6%, as did Seoul’s Kospi at 0.5%. Hang Seng, meanwhile, fared better, ending the day at 0.2% higher.

Shares in the United Arab Emirates’ capital, Abu Dhabi, saw the sharpest one-day fall in the last two weeks as both Etisalat and FGB suffered declines. Etisalat closed at AED 14.25, its worst fall in the last three weeks and lost 3.3%. The fall coincided as they have opened their shares to foreigners for the first time.

FGB, another heavy weight stock on Abu Dhabi’s index, saw a fall of 1.4% closing the day at AED 13.95.

Brought down by these two heavyweights, Abu Dhabi Securities Exchange General Index ended the day at 4,485.99 – a fall of 1.4%.

Dubai Investments and Emirates NBD suffered the most, with Dubai Investment facing a 3.3% dip and Emirates NBD a 3% fall. Telecom operator du, meanwhile, remained unchanged, closing the day at AED 5.17. This was after the board decided to go ahead with an interim dividend of 23 fils per share, which consisted of a cash dividend of 13 fils and the option of a special pay out with each shares costing 10 fils.

Dubai shares, however, closed at 1.5% lower, closing at 3,511.28 and a third consecutive day in red, the lowest level it has reached since the last week of August.

Asset manager at The National Investor, Abu Dhabi, Sebastien Henin is reported to have said that apart from the discouraging performance in Asian markets, investors in the region are uncertain of what a possible rise in the US interest rate will have on the market.

Mr. Henin is also quoted to have said that the investors are in fear of increased volatility in the markets that an increased interest rates will have throughout the world and not just the United Arab Emirates.

A decision on increasing the interest rates for the first time since 2008 will be made on Thursday with the US Federal Reserve Open Market Committee meeting tomorrow.

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