Dubai shares retreat as earnings deepen market caution
Arabian Post Staff -Dubai Dubai stocks ended lower on Friday as disappointing corporate earnings and escalating tension around the Strait of Hormuz weighed on investor sentiment, while Abu Dhabi’s benchmark managed a marginal gain. The Dubai Financial Market’s main index fell 0.4%, extending losses for a second consecutive session. Air Arabia and contractor ALEC Holdings were among the biggest…
Dubai's stocks fell on Friday, with disappointing corporate earnings and rising tensions around the Strait of Hormuz contributing to the decline, while Abu Dhabi's benchmark index managed a slight gain. The Dubai Financial Market's main index dropped 0.4%, continuing its two-day losing streak. Air Arabia and ALEC Holdings were among the main culprits, with their earnings failing to meet investor expectations.
Emaar Properties also underperformed, adding to the pressure on the benchmark index. In Abu Dhabi, the index rose by 0.02% as gains in certain industrial and technology firms balanced the overall weakness. Air Arabia experienced its steepest decline in over three months, plummeting 4.1% after reporting a staggering 75% drop in second-quarter profits due to the conflict in the Middle East disrupting regional aviation and travel demand.
ALEC Holdings, a Dubai-listed construction firm, posted a loss of about AED16 million for the quarter, down from a profit in the same period a year ago. Revenue growth, however, remained strong, driven by a sizable construction pipeline, but earnings were hampered by project disruptions and heightened costs stemming from regional instability.
The contrasting revenue and profit trends have heightened investor worries about margins for contractors operating in complex regional projects. Emaar Properties, a key player in Dubai's stock market, dropped by around 0.5%, adding to the pressure on an index that had previously benefited from strong gains earlier in the year. The US has warned that its naval blockade of Iran could continue indefinitely should diplomatic efforts fail, and this has added to concerns over energy costs, freight rates, and the movement of goods between Gulf states and international markets.
The Strait of Hormuz, a crucial energy route, has seen two attacks on vessels operated by the Abu Dhabi National Oil Company (ADNOC), which the UAE blamed on Iran. Despite the turmoil, oil prices rose, with Brent crude reaching $88.52 a barrel, up by $1.45, and West Texas Intermediate increasing to $82.40, up by $1.15.
Written by urgent.news from Arabian Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
