Worries on global growth concerns are likely to keep Gulf investors cautious as they wait for momentum from third-quarter earnings, despite regional stock valuations seen as attractive.
The euro, oil and Asian shares fell on Monday, weighed down by uncertainty about Spain's bailout and data from Japan to China underscoring sluggish business activity.
"Volatility outside of the GCC is a bit high and is not giving support to longer-term investors at these price levels," says Marwan Shurrab, vice-president and chief trader at Gulfmena Investments. "Our markets are over-sold or at least underperforming international markets - it's obvious we are lagging and we will eventually play the catch-up game as soon as there is a clear direction on equities."
Abu Dhabi's Aldar Properties and Sorouh Real Estate shares may see increased activity after a senior Sorouh executive said a merger between the two developers is expected to be announced "within a month."
Indebted Aldar and Sorouh said in March they were in talks for a state-backed merger, which would create a company with US$15bn in assets.
Shares in the two firms surged on the news in March and Aldar is still up 35.9 percent year-to-date and Sorouh is up 36 percent.
Sentiment in the UAE's banking sector would be dampened after the central bank official said lenders will not be given an extension of the September 30 deadline for them to limit their exposure to state-linked debt.
However, the official said the UAE central bank would deal on an individual, case-by-case basis with commercial banks on the issue of the deadline. He did not elaborate further.
Elsewhere, Bahrain-based Investcorp acquired a 35 percent stake in Kuwait's car leasing and rental firm Automak Automotive Company, marking the alternative asset manager's sixth investment through its US$1bn Gulf Opportunity Fund.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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