Recovering oil prices and stabilising Asian equities provided early comfort for UAE investors this morning, with Abu Dhabi and Dubai shares rising around 2 per cent in early trading.
The Abu Dhabi Securities Exchange General Index was trading up around 2.5 per cent an hour after the open, led by a 6.25 per increase by FGB.
Dubai’s headline index was trading up around 2.2 per cent, thanks to a 3.4 per cent gain by Emaar Properties.
Brent crude futures recovered to above $29 a barrel, hinting that the market has priced in the prospect of increased Iranian production.
“After years of sanctions and underinvestment we doubt that Iran can just turn up the volume and it will take longer than the market believes before full its potential is reached,” said Ole Hansen, Saxo Bank’s head of commodity strategy.
“If this turns out to be the case, it may eventually help oil to stabilise.”
Asian markets traded in positive territory, shrugging off China’s announcement of its weakest annual GDP growth for 25 years. The Shanghai Composite was up around 3.2 per cent, while Japan’s Nikkei closed half a per cent higher.
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