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Tue 6 Nov 2012 11:12 AM

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Gulf markets wary as US goes to polls

Trading on Gulf Arab markets is likely to be uneventful on Tuesday as investors pause to await the outcome of the US elections

Gulf markets wary as US goes to polls
Trading on Gulf Arab markets is likely to be uneventful on Tuesday as investors pause to await the outcome of the US elections.

Trading on Gulf Arab markets is likely to be uneventful on Tuesday as investors pause to await the outcome of the US elections.

US voters will go to the polls to elect a new president and some seats in Congress, with the winners immediately facing tough decisions on tax rates, tax breaks and budget cuts in a convergence of high-stakes deadlines that Federal Reserve Chairman Ben Bernanke dubbed a 'massive fiscal cliff.'

"Today's trading will most probably be uneventful because of the US elections, which will give more clarity on how the US fiscal situation will be handled and whether the president will have the support of Congress," says Marwan Shurrab, vice-president and chief trader at Gulfmena Alternative Investments.

In the United Arab Emirates, markets may again be lacklustre, with Dubai unable to break out of range-bound trading, while Abu Dhabi has eased from Thursday's 15-month peak.

"Company earnings have not been as impressive as expected, which has affected sentiment and halted the positive performance of the past couple of months," says Shurrab.

Nevertheless, UAE investors remain upbeat, he says, with above-forecast earnings from Dubai builder Arabtec likely to support.

Arabtec, one of the most traded stocks on the Dubai bourse, reported a 10.5 percent drop in third-quarter profit but this will still 70 percent higher than the average forecast of analysts polled by Reuters.