Welcome to the 28th edition of Perspectives.

The U.S equity large-cap S&P 500 Index and the technology-heavy Nasdaq Composite Index surged to record highs at the end of July buoyed by positive earnings reports and a dovish stance by the Federal
Reserve. But at the time of our writing, investors’ sentiment is turning more negative as U.S-China Trade war risk is coming back with a vengeance.

In this edition, we take a step back from international markets to focus on UAE prospects and Dubai in particular. While the DFM (Dubai Financial Markets) index has been lagging meaningfully the broader S&P Pan Arab index over the last 3 years, our 2019 bullish stance could well be vindicated. Indeed, as of the end of July, the main Dubai index has gained 15% year to date, outperforming other regional indices such as the Tadawul index and the ADX.

In the first section, we look in more details at Dubai and UAE equity performance in 2019 and share the view that this rally is built on increasingly solid foundations. The investment theme of the month is about the China-UAE ties as a three-day visit to China in late July by Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed has again shown the importance of this gradually deepening bilateral relationship. A wide range of economic sectors across the UAE could benefit from the UAE-China ties for many years to come.

In the “Hot Topic” section, we shed light on the Dubai Expo 2020, which is expected to have an incredibly positive impact on the UAE while acting as a catalyst to energize retail, leisure, hospitality and consumer businesses in the country. In the last part of this edition, we re-visit the bullish investment thesis we developed in our January 2019 outlook and share our top picks within UAE equity markets.

We hope you will enjoy this issue.

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