Equity markets in the UAE closed lower for the fourth consecutive session on Friday, reflecting lower crude oil prices amid fears that monetary tightening will affect fuel demand.
US Federal Reserve Chairman Jerome Powell hinted at the possibility of higher and possibly faster interest rate hikes, saying the Fed was wrong in its initial belief that inflation was “temporary.”
Oil prices, one of the main factors affecting the economies of the Gulf countries, continued to decline during the fourth session, with Brent falling 24 cents, or 0.29%, to $81.38 a barrel by 11:02 GMT.
The currencies of most Gulf countries, including the UAE, are pegged to the dollar, making them vulnerable to any direct currency changes in the world’s largest economy.
The main index in Dubai fell 0.7% under the influence of large losses in shares of the real estate and financial sector, which have weight on it.
Dubai Commercial Bank, the biggest loser in the index, has fallen sharply, the shares are trading without the right to pay dividends. Shares of Tecom Group fell 2.9%.
On the other hand, the Emirati company Al-Ansari Exchange said yesterday, Thursday, that it intends to place 10% of the shares in Dubai through an initial public offering.
In Abu Dhabi, the index fell 0.3%, while Multipleplay Group’s share fell 2.1%. Shares of Alpha Abu Dhabi Holding Group lost 0.4%, according to Reuters.
Farah Murad, Senior Market Analyst for the Middle East and North Africa at XTB, said the Abu Dhabi Stock Exchange could still see some price corrections amid falling oil prices and lower global sentiment.
