(Reuters) – Stock markets in the United Arab Emirates rose in early trade on Sunday, starting 2021 on a positive note in line with the country’s economic forecast and eclipsing a recent record jump in COVID-19 cases.
The International Monetary Fund expects the country’s economy to swing back to growth of 1.3 percent this year from a 6.6 percent contraction in 2020.
The UAE recorded its fourth straight record number of daily coronavirus cases since the pandemic began, reporting 1,963 cases on Saturday
Dubai’s index gained 0.8 percent, boosted by real estate and banking shares. Emirates NBD increased 1.5 percent, while Emaar Properties led the gains at property stocks, rising 1.1 percent.
Dubai is expected to grow by four percent in 2021.
“I expect 2021 to be a grand reopening year for the Dubai business and economy. I think the pent-up travel & tourism demand, as well as revenge buying should provide the demand boost to major economic sectors”, said Joice Mathew, senior research manager at United Securities.
“Meanwhile, the Expo 2020 scheduled for 2H-2021 should provide a big boost to consumer-linked sectors”, Junaid Ansari, Acting Head of Investment Strategy & Research at Kamco Invest said.
In Abu Dhabi, the index was up 0.4 percent as First Abu Dhabi Bank rose 0.8 percent and telecoms major Etisalat added 0.6 percent.
Saudi Arabia’s benchmark index was down 0.6 percent. Saudi Industrial Investment was the biggest loser, declining four percent as it traded ex-dividend.
Saudi Basic Industries shed 0.6 percent.
The Qatari index was down 0.3 percent as Commercial Bank dropped 2.2 percent and Industries Qatar lost 0.6 percent.
Qatar enters another year of its blockade by Saudi Arabia, Egypt, UAE and Bahrain on accusations of backing “terrorist” groups, charges which Doha denies.
A Gulf Cooperation Council (GCC) summit will be held on January 5 to discuss steps towards ending the diplomatic row with Qatar.
“I see some regional companies from Saudi, UAE, and Qatar to benefit in case these countries reach a settlement to the issues and remove the blockade”, said Mathew.
Reporting by Maqsood Alam in Bengaluru, Editing by William Maclean
