Investors cheered by the sharp rebound of UAE stocks on Thursday should brace themselves for more ups and downs until the bottom for the oil market becomes clearer, fund managers said.
“One thing I am sure of for next week is that the volatility will be there,” said Sebastien Henin, the head of asset management at the Abu Dhabi-based investment firm The National Investor.
“In the past week we have had some factors that have affected this volatility, like margin calls, which won’t be here next week,” he added. “I think the volatility will go down, but it might take a couple of weeks for things to stabilise. Markets should go up and down until a floor for oil is found. The market will trade both ways.”
Dubai's main benchmark index rallied 13 per cent on Thursday, its biggest jump to date, while Abu Dhabi's main equities gauge, the ADX General Index increased by 6.7 per cent, its biggest gain since 2009. The DFM General Index had shed 14 per cent since the beginning of the week before Thursday's rebound, and more than Dh60 billion was wiped off the market value of the country's equities in the same period. That drop came as Brent crude extended losses to levels not reached since 2009 as the cost of a barrel declined below $60.
The UAE is the world's eighth-biggest oil producer and the Federal Government funds more than 60 per cent of its budget from crude exports. The drop in oil, which has shed 45 per cent of its value this year, comes amid increasing production in countries such as the United States and waning demand amid global economic uncertainty.
The Energy Minister, Suhail Al Mazrouei, said on Tuesday that the country could cope with the drop in oil prices, and that the large fiscal reserves that the UAE has built up would allow it to keep spending on development projects in coming years.
“Thankfully the environment is very different from 2008,” said Mr Henin. “There is consensus in the market that the governments will not reduce spending. We had some calls with some prospective clients in Europe. They are contemplating the idea of allocating money to the region. Before, even if our prospects were very positive in terms of visibility and fundamentals of the region, they were not comfortable with one point, which was valuations.”
After the recent drop, the price-to-earnings ratio, a measure of gauging the cheapness of stocks, has dropped in line with other emerging markets. The Standard & Poor's/IFC Global United Arab Emirates Price Index, a measure of equities in Dubai and Abu Dhabi, now trades at a forward multiple of 10.1 times earnings compared to 10.6 for the MSCI Emerging Markets Index. The MSCI AWCI Index, which tracks stocks in the developed world and emerging markets, trades at a multiple of 14.3 times earnings.
Still, despite the attractive valuations, other global factors, such as Russia’s economic meltdown, might affect the direction of UAE stocks this week, even after the US Federal Reserve said it was not in a rush to raise short-term interest rates. Low interest rates on the dollar typically give investors more appetite for investing in riskier emerging-market assets.
mkassem@thenational.ae
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Greatest of All Time
Starring: Vijay, Sneha, Prashanth, Prabhu Deva, Mohan
Empire of Enchantment: The Story of Indian Magic
John Zubrzycki, Hurst Publishers
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
Company%20Profile
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Company%20profile
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Confirmed%20bouts%20(more%20to%20be%20added)
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BEETLEJUICE BEETLEJUICE
Starring: Winona Ryder, Michael Keaton, Jenny Ortega
Director: Tim Burton
Rating: 3/5
Stage 2
1. Mathieu van der Poel (NED) Alpecin-Fenix 4:18:30
2. Tadej Pogacar (SLV) UAE Team Emirates 0:00:06
3. Primoz Roglic (SLV) Jumbo-Visma 0:00:06
4. Wilco Kelderman (NED) Bora-Hansgrohe 0:00:06
5. Julian Alaphilippe (FRA) Deceuninck-QuickStep 0:00:08
SPECS
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%20Two-litre%20four-cylinder%20turbo%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E235hp%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E350Nm%3Cbr%3E%3Cstrong%3ETransmission%3A%3C%2Fstrong%3E%20Nine-speed%20automatic%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh167%2C500%20(%2445%2C000)%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3ENow%3C%2Fp%3E%0A
COMPANY%20PROFILE
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Sweet%20Tooth
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Types of bank fraud
1) Phishing
Fraudsters send an unsolicited email that appears to be from a financial institution or online retailer. The hoax email requests that you provide sensitive information, often by clicking on to a link leading to a fake website.
2) Smishing
The SMS equivalent of phishing. Fraudsters falsify the telephone number through “text spoofing,” so that it appears to be a genuine text from the bank.
3) Vishing
The telephone equivalent of phishing and smishing. Fraudsters may pose as bank staff, police or government officials. They may persuade the consumer to transfer money or divulge personal information.
4) SIM swap
Fraudsters duplicate the SIM of your mobile number without your knowledge or authorisation, allowing them to conduct financial transactions with your bank.
5) Identity theft
Someone illegally obtains your confidential information, through various ways, such as theft of your wallet, bank and utility bill statements, computer intrusion and social networks.
6) Prize scams
Fraudsters claiming to be authorised representatives from well-known organisations (such as Etisalat, du, Dubai Shopping Festival, Expo2020, Lulu Hypermarket etc) contact victims to tell them they have won a cash prize and request them to share confidential banking details to transfer the prize money.
ANDROID%20VERSION%20NAMES%2C%20IN%20ORDER
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The specs
Engine: Long-range single or dual motor with 200kW or 400kW battery
Transmission: Single-speed automatic
Max touring range: 620km / 590km
Price: From Dh250,000 (estimated)
Dirham Stretcher tips for having a baby in the UAE
Selma Abdelhamid, the group's moderator, offers her guide to guide the cost of having a young family:
• Buy second hand stuff
They grow so fast. Don't get a second hand car seat though, unless you 100 per cent know it's not expired and hasn't been in an accident.
• Get a health card and vaccinate your child for free at government health centres
Ms Ma says she discovered this after spending thousands on vaccinations at private clinics.
• Join mum and baby coffee mornings provided by clinics, babysitting companies or nurseries.
Before joining baby classes ask for a free trial session. This way you will know if it's for you or not. You'll be surprised how great some classes are and how bad others are.
• Once baby is ready for solids, cook at home
Take the food with you in reusable pouches or jars. You'll save a fortune and you'll know exactly what you're feeding your child.
Abu Dhabi Sustainability Week
COMPANY%20PROFILE
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Company%20Profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20Cargoz%3Cbr%3E%3Cstrong%3EDate%20started%3A%3C%2Fstrong%3E%20January%202022%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Premlal%20Pullisserry%20and%20Lijo%20Antony%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%3Cbr%3E%3Cstrong%3ENumber%20of%20staff%3A%3C%2Fstrong%3E%2030%3Cbr%3E%3Cstrong%3EInvestment%20stage%3A%3C%2Fstrong%3E%20Seed%3C%2Fp%3E%0A
The Details
Kabir Singh
Produced by: Cinestaan Studios, T-Series
Directed by: Sandeep Reddy Vanga
Starring: Shahid Kapoor, Kiara Advani, Suresh Oberoi, Soham Majumdar, Arjun Pahwa
Rating: 2.5/5
Zayed Sustainability Prize