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Dubai Market Rebounds After Rate Cuts

DUBAI — The Dubai Financial Market (DFM) rebounded on Thursday, bolstered by a series of rate cuts by world central banks including the Central Bank of UAE, following severe losses this week.

The Dubai’s stock benchmark index rose 113.08 points, or 3.6 per cent, to end the session at 3,198.09. Thursday’s rise came after the Dubai’s index lost over quarter of its value Sunday through Wednesday.

The Abu Dhabi Securities Exchange’s (ADI) General Index gained 30.36 points, 0.96 per cent, to close at 3,207.30.

On Thursday, the UAE central bank announced a cut in its overnight repurchase rate by 50 basis points to 1.5 per cent, following a similar cut by the US Federal Reserves and other western central banks.

Analysts said Gulf stock markets are expected to stabilise in the near term following actions taken by regional central banks to cut key interest rates.

“The chances of further downside at current levels are limited and the regional equities markets are expected to stabilise next week,” an analyst, who did not want to be named, told Khaleej Times from Bahrain.

“However, recovery at the Dubai market will be slow as this market has more co-relation with the US and European markets compared to other markets in the region,” he added.

Since September 29 till Wednesday, Gulf Cooperation Council bloc countries, has cumulatively lost about $186 billion in market capitalisation.

On Thursday, real-estate and banking shares made a recovery with real-estate sector rising 5 per cent while banking sector registered an increase of 2.12 per cent.

Emaar Properties gained 3.6 per cent to Dh5.70 while Arabtec closed up 13 per cent to Dh7.69.

Dubai Islamic Bank ended 4.6 per cent. In the Dubai International Financial Exchange, DP World shares ended up 1.85 per cent to close at $0.55 cents.

· imranmaqbool@khaleejtimes.com