Macro and fundamental factors indicate UAE markets in early stages of revival
DUBAI (United Arab Emirates): The UAE markets are in the midst of a long-term, multi-year upward trend, and the bullish performance thus far signals a revival that is only in its early stages, according to Daman Investments, the leading Dubai-based investment management company, which held its traditional Summer press briefing today. Unveiling the 2013 edition of its annual market report to members of the press at a media roundtable, Daman Investments top management officials led by Managing Director Mr. Shehab Gargash, ran through an analysis of both macro and fundamental factors that underpin movements seen in the UAE financial markets.
Research conducted by Daman Investments found that nine of the 11 key factors identified by Daman fall into positive territory, thereby leading it to conclude that the UAE bourses, the Dubai Financial Market (DFM) and the Abu Dhabi Securities Exchange (ADX) , have an optimistic outlook. The findings essentially indicate that since the rally seen in the UAE exchanges only signifies the beginning of a multi-year bullish cycle, it is not yet too late to enter the market as significant returns lay ahead for investors with longer term investment horizons.
The report looked in detail at the key sectors driving the UAE economy such as trade, tourism and transport. It also noted the strong resurgence of the Dubai Real Estate market. Additionally, it pointed out the increase in bank lending activity this year and the strong capital positions of UAE banks.
From a bottom up perspective looking at earnings and valuations, UAE corporates look to be in good health. In light of these findings, Daman is looking for double-digit earnings growth for the market as a whole in 2013. Despite the positive outlook, however, valuations still remain below their long-term trend.
Daman Investments identified three key catalysts that will give the market further impetus. Firstly, the market needs to switch from secondary activities/offerings such as share buybacks and rights issues to primary market activities like IPOs. Secondly, bank financing must be made available for active stock market portfolios and finally, foreign institutional participation in UAE bourses needs to be increased. This would provide a continuation of much-needed liquidity to the markets and serve to highlight the inherent growth potential of UAE markets.
About Daman Investments PSC
Daman Investments PSC is a private joint stock company based in Dubai, UAE. From its early beginnings in 1998, the group has grown rapidly into a non-bank financial services company now widely recognized as an authority in its core markets, the Gulf Cooperation Council and Iraq.
Known for offering innovative investment products and services to both regional and international clients, Daman provides investment management and development capital investment opportunities as well as brokerage operations through its subsidiaries. Daman is committed to the principles of ethical business practice and operational transparency. All Daman’s various operations are regulated by the United Arab Emirates Central Bank, the Emirates Securities and Commodities Authority (ESCA) and the Dubai Financial Services Authority (DFSA).
For further details please contact:
Daman Corporate Communications OR Arabia PR
Nadimeh Mehra Yasser Fathy
Tel: +971 4 332 41 40 Tel: + 971 4 342 35 84
Fax: +971 4 332 42 40 Fax: + 9714 342 35 82