Dubai stocks climbed for a seventh day, the longest winning streak in two months, tracking a global rally amid optimism central banks will continue their monetary stimulus measures.
The benchmark DFM General Index, the world’s third-best performer this year among 94 gauges tracked by Bloomberg, gained 2 percent at the close in Dubai to the highest close since November 2008. Abu Dhabi’s measure increased 0.9 percent.
Emerging-market stocks rose, extending a weekly rally, as the European Central Bank executive board member Vitor Constancio said the euro area’s slow recovery implies that policy has to stay “accommodative for a longer period of time”. U.S. stocks also rose for a third week, sending benchmark indexes to all-time highs, as Federal Reserve Chairman Ben S. Bernanke pledged sustained monetary stimulus.
“Dubai is likely up on the back of U.S. markets hitting record highs on Friday after the Fed reassured investors that it would continue to keep the floodgates of cheap money open,” said Gus Chehayeb, the Dubai-based research director for the Middle East at investment bank Exotix Ltd. “It seems the Fed is backing down after the capital markets rioted over the past two months.”
Bernanke said on July 10 that the U.S. economy will continue to need stimulus measures because of low inflation and high unemployment. China’s Finance Minister Lou Jiwei said a 6.5 percent growth rate wouldn’t be a “big problem.”
The MSCI Emerging Markets Index rose 0.3 percent to 945.36, taking its weekly gain to 3 percent. The Standard & Poor’s 500 Index slumped as much as 5.8 percent after Bernanke signaled on May 22 that the Fed could start scaling back bond purchases as soon as September. Stocks have since recovered all those losses as data on hiring and housing bolstered confidence in the economic recovery.
Dubai Investments PJSC jumped 7.1 percent to the highest since November 2008. Emaar Properties PJSC, developer of the world’s tallest tower, climbed 1.9 percent.
In Egypt, Commercial International Bank Ltd., the country’s biggest publicly traded lender, rose 1.5 percent, helping boost the benchmark EGX 30 Index at the close. The Egyptian public prosecutor’s office started an investigation of deposed Islamist President Mohamed Mursi as thousands of supporters vowed to keep up their protests until he is reinstated.
Elsewhere in the Middle East, Saudi Arabia’s Tadawul All Share Index rose 0.6 percent. Oman’s MSM30 Index and Kuwait’s gauge climbed 0.4 percent each. Israel’s benchmark TA-25 Index increased 0.6 percent. The yield on the nation’s benchmark 4.25 percent bonds maturing in March 2023 was unchanged at 3.78 percent.