Finance and Economy

The Dubai Financial Market dipped 0.80% today to close on 2,319, led by the day's most actively traded stock, Emmar, which fell 0.82%. Overall just six shares rose while 26 declined. Among the day's big gainers were Du and Shuaa Capital, which rose 3.54% and 1.46% respectively.

A new survey has found that a large majority of companies in the UAE plan to raise salaries and staff levels in 2010. The survey of over 100 companies by HR consulting firm Mercer revealed that nine out of 10 firms plan to raise salaries next year, while nearly two-thirds said they plan to increase their workforce. Moreover, Mercer said companies plan to boost salaries on average 7%-7.5% in 2010, up from increases of 3.4%-5.2% this year.

The UAE plans to increase government spending by 3.4% next year under its 2010 draft budget. The country will spend dhs43.6 billion ($11.9bn), or 3.4% more than budgeted for this year, the finance ministry said. 'The UAE government has presented a zero-deficit budget, balanced between incomes and expenditure for the sixth consecutive year,' the ministry said. "The 2010 budget shows a growth despite the financial crisis and indicates the growth in ministries' revenues estimated at dhs20.8 billion in 2010 compared to dhs7 billion in 1999." Finance Ministry Unders-ecretary Younis al-Khouri said the emirate of Abu Dhabi would contribute the lion's share of revenues at dhs17.7 billion, while Dubai's contribution was set at dhs1.2 billion.

Zurich, the Swiss insurance giant has launched its general insurance business in Dubai, which will serve as a base for the company to expand in the Gulf and the wider Middle East, Reuters has reported. 'We are looking at various strategies to get licenses in a significant number of other countries, our priority is the Gulf Cooperation Council,' Geoff Riddell, chairman of global corporate and chief executive of Asia-Pacific and Middle East at Zurich, told the news service. 'The highest profile issues would be the Saudi cities and the UAE's nuclear developments, those are only a small part of the whole, the access to capital investments is an accelerating driver for general insurance here,' he said.

UK-based insurer Prudential has revealed plans to launch two Islamic equity funds in Dubai in the coming months, Reuters has reported. The firm expects strong demand for Sharia-compliant funds once Dubai bounces back from an economic slowdown. 'If Muslims have a choice, they would invest in (Islamic funds), previously there were none,' said Mark Toh, Prudential Corp Asia's regional Islamic fund management head.

Saudi Arabia's Tadawul index rose by 0.55% to 6,563, with all sectors moving upward, led by transport which rose 1.93%. Overall, 93 stocks finished higher, while 24 ended lower. Alinma Bank, the day's most heavily traded stock, gained 1.44% to close on 14.05 riyals.

The Dubai Financial Market on Monday gained 3.31% to close on 2,338. Market heavyweight Emaar was one of the day's big gainers, rising 4.50% to Dhs4.88. Other heavily traded stocks included the Dubai Financial Market, up 6.43% to Dhs2.65, and Arabtec, which rose 4.39% to Dhs3.57.

The Abu Dhabi Securities Index on Monday gained 0.65% to close on 3,167. The index was led by the real estate sector, which rose 1.86%. Overall, 25 stocks gained, eight declined, and nine remained unchanged.

Investor confidence rose in all six countries of the GCC in October, according to Dubai-based Shuaa Capital. The bank's GCC Investor Confidence Index increased to 132.2 points in October, up 3.8% from 127.3 in September, rising for a third consecutive month. Saudi Arabia and the UAE had the largest gains on the index, climbing 11.7% to 154.9 points and 9.2% to 130.4 respectively. Qatar rose 7.4 points to 143.1, Kuwait climbed 4 points to 102.5, Oman rose 2.9 points to 118.1 and Bahrain fell 0.9 points to 106.9 points. Any score over 100 points indicates positive investor confidence. Investor sentiment in the Gulf continued to strengthen in October, with all six countries recording positive levels of confidence as the outlook for the region's economies improves, Shuaa Capital said on Monday. The Dubai-based investment bank said its GCC Investor Confidence Index rose to 132.2 points in October, up 3.8 percent from 127.3 in September, increasing for its third consecutive month. Saudi Arabia and the UAE witnessed the biggest gains on the index, jumping 11.7 percent to 154.9 points and 9.2 percent to 130.4 respectively.

A new stimulus package worth 10 billion Egyptian pounds ($1.8bn) will be proposed at a conference of the ruling National Democratic Party at the end of this month, a government official told Reuters. 'The government will raise an additional 10 billion pounds to be spent on infrastructure projects such as road building and water treatment to create jobs,' an official with the Ministry of Economic Development told the news service.

Egypt's central bank has said it will introduce a core inflation index, a measure that usually strips out potentially volatile items, such as food and energy, Reuters has reported. The index aims to help make forecasts in the country, which has sought to bring down price rises that peaked at more than 20% in 2008. 'The core inflation index is a very important tool that sheds lights on reasons inflation rates went up,' according to Rania al-Mashat, head of monetary policy division at the central bank.

The Dubai government has set up a $6.5bn program to sell medium-term notes as it launches its first international bond sale since June 2008, Bloomberg has reported. The offering is separate from a $10bn fund-raising program, which is part of a $20bn support fund that the Dubai government set has up for state-related companies. The sale of Islamic bonds and those that don't comply with Muslim banking rules may take place as soon as next week.

Pressure on the Greenback continued last week, with the US Dollar Index, which tracks the currency against the Euro, Swiss Franc, Yen, Sterling, Swedish Krona, and Canadian Dollar, falling below 75 levels on October 21, its lowest point since August 2008. This was mainly due to the positive Q3 earnings reported by US companies, where more than 80% of corporate results continued to defy earnings expectations.

Saudi Arabia's Tadawul index fell by 0.62% to 6,527.53, with the majority of sectors moving downwards and only Retail, Transport and Hotels keeping their positive sentiment. Eighty-four stocks fell, with only 33 rising. Walaa insurance posted the highest gains, moving up by 9.94% to SR34.30.

The Abu Dhabi Securities Exchange ended the day up by 0.89% to 3,147.44 after slow gains throughout trading. Seventeen stocks rose, nine fell and eight held steady. ADCB was the highest riser, making modest gains of 4.21% to Dhs2.28. The real estate sector kept the market busy, with Aldar and Sorouh being the most actively traded stocks by value.