UAE stocks extend bull run as Biden stimulus lifts global markets

Dubai - The Abu Dhabi and Dubai benchmarks have now ended seven sessions in positive territory out of the eight trading days so far in the New Year

Stocks in the UAE extended their winning run on Tuesday as global markets and US futures rose while investors waited for details of President-elect Joe Biden’s promised economic stimulus plan.

With financials lifting the Abu Dhabi benchmark to its fourth straight session of gains by 0.4 per cent higher, the UAE’s largest lender, First Abu Dhabi Bank, firmed 0.9 per cent, while Abu Dhabi Islamic Bank added 1.0 per cent.

In Dubai, the main share index tacked on nearly a per cent, supported by a 1.2 per cent gain in sharia-compliant lender Dubai Islamic Bank and a 0.9 per cent rise in Emirates NBD Bank, the emirate’s biggest bank.

The Abu Dhabi and Dubai benchmarks have now ended seven sessions in positive territory out of the eight trading days so far in the New Year.

Underpinning the broader regional gains on the day, oil hit an 11-month high towards $57 a barrel as tighter supply and expectations of a drop in US petroleum inventories offset concerns over climbing coronavirus cases globally.

London and Frankfurt opened higher while Shanghai, Tokyo and Hong Kong advanced.

Investors were encouraged by US election results that gave Biden’s Democratic Party control of the Senate, reducing potential opposition to his stimulus plans. Biden promised to announce details this week of the plan he will propose after he takes office Jan. 20.

“Investors found optimism in the prospect of further fiscal stimulus,” said Cesar Perez Ruiz of Pictet Wealth Management in a report. With the Senate in Democratic hands, “President-elect Biden has a better chance of pushing through his agenda and delivering sorely-needed stimulus and support.”

No major potentially market-moving events were on the calendar Tuesday in Asia.

In early trading, the FTSE 100 in London rose 0.1 per cent to 6,808.60 and the DAX in Frankfurt added 0.3 per cent to 13,981.31. The CAC 40 in France added 0.3 per cent. to 5,67.56.

On Wall Street, futures for the benchmark S&P 500 index and the Dow Jones Industrial Averages were up 0.2 per cent.

On Monday, the S&P 500 declined 0.7 per cent while the Dow lost 0.3 per cent. The Nasdaq composite slid 1.3 per cent..

In Asia, the Shanghai Composite Index rose 2.2 per cent to 3,608.34 and the Nikkei 225 in Tokyo added 0.1 per cent to 28,164.34. The Hang Seng in Hong Kong gained 1.3 per cent to 28,271.76.

In India, both the BSE Sensex and the Nifty50 on the National Stock Exchange (NSE) rose above the psychological levels of 49,500 and 14,500 points, respectively. The BSE Sensex touched a new all-time high of 49,569.14 points while the Nifty50 hit a new high of 14,590.65 points.

The market was supported by gains in the heavyweight stocks of Reliance Industries (RIL) and HDFC. RIL shares, which have largely been subdued in the past few months, surged over 3.0 per cent on Tuesday.

Elsewhere in the Middle East, Saudi Arabia’s benchmark index added 0.2 per cent.

Outside the Gulf, Egypt’s blue-chip index strengthened 0.5 per cent., aided by a 2.1 per cent.

Qatar lost 0.04 per cent to 10,839; Egypt firmed 0.5 per cent to 11,340; Bahrain added 0.4 per cent to 1,458; Oman fell 1.4 per cent to 3,675; and Kuwait gained 0.6 per cent to 6,169.

In energy markets, benchmark US crude gained 40 cents to $52.65 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 1 cent on Monday to $52.25. Brent crude, used to price international oils, advanced 37 cents to $56.03 per barrel in London. It fell 33 cents the previous session to $55.66 a barrel.

The dollar rose to 104.21 Japanese yen from Monday’s 104.16. The euro fell to $1.2156 from $1.2163.

issacjohn@khaleejtimes.com