DFM and ADX Post Third Weekly Gain as UAE Markets Start Year Strong : Comments from Vijay Valecha , CIO – Century Financial

• DFM General Index 

Despite Friday’s wobble, Dubai’s benchmark DFM General Index delivered its third consecutive weekly gain. It ended the week at 6,484.38. On January 22, the index gained 1.5%, marking its largest gain since mid-July 2025. In fact, Dubai started the year on a solid footing, delivering a month-to-date gain of 7.2%. This week’s gains stand at 2.7%, supported by an overall uptick in risk appetite after Trump decided not to impose 10% tariffs on European countries over the Greenland dispute. Despite this stellar performance, the DFM General Index’s forward P/E stands at 11.8x, making it attractive for domestic and foreign investors. ADNOC Distribution’s share price got a boost this week after prominent Wall Street banks raised the price target amid high retail fuel volume growth.

Top gainers for the week include SHUAA Capital (+8.77%), Dubai Investments (+8.40%), TECOM Group (+8.04%), Union Properties (+6.86%), and Islamic Arab Insurance (+6.26%). By comparison, National Cement, Sukoon Takaful, and Dubai National Insurance & Reinsurance were the top laggards, falling by 5.01%, 3.85%, and 2.40%, respectively. Looking at the sector-wise performance, all sectors barring Consumer Discretionary (-1.21%) and Materials (-5.01%) ended the week in positive territory. Real Estate was the biggest winner, posting a 4.62% gain. This was followed by Utilities (+3.08%), Financials (+2.38%), Industrials (+2.30%), Consumer Staples (+1.58%), and Communication Services (+0.97%).

• ADX General Index 

The ADX General Index also delivered its third straight weekly gain, despite declining 0.2% on Friday to end the week at 10,285.77. The index gained 1.6% this week, marking its steepest gain since early December 2025. Its gains for the month stand at around 2.9%, keeping the index just 0.9% below its 52-week high achieved in mid-2025. Healthcare emerged as the best-performing sector this week, yielding a return of over 10%. Real estate was the second-best performer, gaining over 5% this week. Technology and Basic Materials advanced 3.54% and 2.17%, respectively. On the flip side, sectors like Utilities (-1.69%), Consumer Discretionary (-0.58%), and Consumer Staples (-0.17%) underperformed.

Upcoming Earnings –
In Dubai, big banks like Emirates NBD, Mashreqbank, Emirates Islamic Bank, and Ajman Bank are slated to report earnings next week, alongside Dubai Financial Market PJSC and Sukoon Insurance PJSC. Meanwhile, noteworthy companies reporting earnings in Abu Dhabi include First Abu Dhabi Bank, Abu Dhabi Commercial Bank, National Bank of Ras Al Khaimah, National Bank of Fujairah, NMDC Energy, to name a few.

Looking Ahead –
Moving forward, global headlines concerning Trump and other geopolitical issues could dictate global risk sentiment, thereby impacting the UAE markets as well. Next week, the U.S. is also set to announce its first interest rate decision for 2026. Given the currency peg between the AED and USD, the CBUAE is also expected to mirror the Fed’s move, which could spark volatility in the shares of rate-sensitive sectors in the UAE. This includes banks, and movement could also be compounded by earnings announcements by major banks in the region. Even real estate companies could experience some volatility, alongside utilities and infrastructure-linked stocks.