Stocks in the United Arab Emirates declined on Friday, pressured by losses in crude prices as strong U.S. and German economic data sparked concerns that sticky inflation could prolong higher interest rates and curb fuel demand.
Oil prices – a key catalyst for Gulf’s financial markets – drifted lower on Friday with Brent crude easing 0.74% to $80.76 a barrel by 1032 GMT. Data on Thursday showed U.S. jobless claims dropped while S&P Global’s Flash PMI survey showed business activity expanded faster than economists forecast in May.
Most Gulf Cooperation Council (GCC) countries, including the United Arab Emirates, have their currencies pegged to the U.S. dollar and they generally follow the Fed’s policy moves.
Abu Dhabi’s benchmark index dropped 0.6%, hitting their lowest level in over 27-months, dragged down by a 6.9% drop in state-run utility firm Abu Dhabi Nation Energy Company, while Abu Dhabi healthcare platform Pure Health Holding shed 5.8%. Meanwhile, crypto mining firm Phoenix Group gained 4.8%, recovering from six straight sessions of losses that took it below the listing price. However, Palms Sports jumped 2.6% after the firm acquired an 80% Stake In Yas Physiotherapy Center.
Dubai’s main index settled 0.3% lower, and 1.4% down for the week, to its lowest level since late December last year as market heavyweight Emaar Properties and Emirates NBD Bank lost 1.6% each.
Abu Dhabi’s index logged 2.3% losses, its steepest weekly decline since mid-October last year.
ABU DHABI down 0.6% to 8,834 points
DUBAI fell 0.3% to 4,013 points
(Reporting by Mohd Edrees in Bengaluru Editing by Peter Graff)
