Dubai slips on weak Air Arabia and Alec earnings while Abu Dhabi edges up

Dubai's principal index slipped on Friday, following the United States' announcement of an indefinite naval blockade of Iran, raising concerns about potential disruptions to trade in the Middle East. Meanwhile, Abu Dhabi's index saw a slight increase. The US had previously indicated that it might maintain the naval blockade indefinitely and intensify economic pressure on Iran, amid ongoing failures in ceasefire negotiations.

Dubai's main index declined by 0.4% for the second consecutive day, primarily influenced by a sharp 4.1% drop in Air Arabia and a 0.5% fall in Emaar Properties. Air Arabia, a budget carrier, experienced its largest single-day drop in over three months, reporting a 75% plunge in its second-quarter net profit to 87.9 million dirhams ($23.93 million).

Additionally, Alec Holding, a construction firm owned by the Investment Corporation of Dubai, dropped by 4.4% to a four-month low after announcing a second-quarter loss of 16.3 million dirhams ($4.44 million), contrasting with a profit of 122.9 million dirhams in the previous year.

In contrast, Abu Dhabi's benchmark index managed to rise by 0.02%, buoyed by a 1.8% surge in Orascom Construction and a space tech firm specializing in artificial intelligence. Orascom Construction, an Egyptian company, reported a remarkable 74% increase in its second-quarter net profit to $61.9 million. Adnoc Gas, however, declined by 0.9% following reports that two of its vessels were attacked while traversing the Strait of Hormuz on Thursday evening.

The Abu Dhabi index experienced a 0.5% weekly decline, marking a reversal after three consecutive weeks of gains, as per LSEG data.