Analysts: Lower fees and interest supports the performance of domestic stocks
Financial analysts reported that reducing and canceling about 1,500 federal services and anticipating interest rate cuts globally and locally were key factors contributing to domestic equities during the week. The Dubai Financial Market index rose 0.49%, while the Abu Dhabi Securities Market Index rose 1%
Financial analysts said cutting and canceling about 1,500 federal services, anticipating interest rate cuts globally and domestically, were key factors contributing to domestic equities during the week.
The Dubai Financial Market index rose 0.49%, while the Abu Dhabi Securities Market Index rose by 1%, and the two markets achieved capital gains of 5.7 billion dirhams, supported by the purchase of foreigners and institutions.
In detail, the Dubai Financial Market index rose by 0.94% during the week last week, and achieved a capital gain of 173.5 million dirhams, closing at 2685.58 points.
The Abu Dhabi Securities Market index rose by 1%, to close at 5052.43 points. Its market capitalization gained 5.54 billion dirhams.
"There is some news that has contributed to the performance of some stocks in the Abu Dhabi market, such as contracts awarded by the Government of Abu Dhabi to a real estate company, which contributed to the rise," said Wael Muheisen, managing director of Global Equity and Bonds. He added that shares of real estate companies were a major contributor to the rise of the Dubai market during the week as well.
He explained that the expectations for the reduction of interest rates, the impact on domestic stocks in most of the session yesterday, expected to contribute positively to the performance of shares during the coming period.
He pointed out that the reduction and cancellation of service fees for more than 1500 government services will contribute to the promotion of economic activity in the State, will improve the performance of companies, and will be a new attraction for domestic and foreign investments, which will also affect the market.
For his part, said a member of the National Advisory Board of the Institute of Investment and Securities UK in the UAE, Waddah Taha, that «the general atmosphere helps to rise stocks during the current period».
He explained that the potential reduction of the domestic interest rate, amid strong expectations of a reduction (US Federal Reserve) interest rates, will reflect positively on the performance of the economy all, and the performance of shares, especially banks.
He said cutting the fees for 1,500 government services would have an impact on the medium and long term, but its current impact is to stimulate investors.
Al-Ansari Financial Services Director General Iyad Al-Barriqi said, "Positive performance over the week's sessions was supported by rising leading stocks such as Emaar, Arabtec, bank stocks and selected stocks, And Dana and Salama.
He pointed out that the liquidity level witnessed a rise during the week, and its source varied between institutions and individuals, coinciding with the Abu Dhabi market reduced the commission rate of excellent, which was a catalyst for the return of liquidity, in addition to the impact of the rise of US markets during the week, which overshadowed the performance of markets Local. He pointed out that the market is waiting for the results of the first half, and there is optimism in the positive performance of the results of the listed companies, as well as the calm geopolitical conditions have positively affected the raising of the situation of confidence, and led to raising the volume of liquidity and high prices.