UAE markets face technical weakness amid global headwinds

17/11/2025 04:17 AST

Dubai and Abu Dhabi equities closed last week on a cautious note, signaling a fragile outlook as global risk-off sentiment continues to weigh on regional benchmarks. Analysts expect consolidation in the near term, with technical indicators pointing to limited upside unless macro conditions improve.

"Despite strong corporate earnings, UAE markets are tracking global weakness, particularly in technology and financial sectors," said Vijay Valecha, Chief Investment Officer at Century Financial. "Investors should brace for volatility as indices hover near key support levels."

Dubai Financial Market: Pressure persists despite earnings strength
The DFM General Index slipped 1.25 per cent for the week ended 14 November, closing near 5,949, as selling pressure intensified following declines in global equities. Heavyweights such as Emirates NBD Bank (-7.91 per cent), Talabat Holding (-8.67 per cent), and Dubai Electricity & Water Authority (-1.79 per cent) dragged the index lower. Gains in Emaar Properties (+1.47 per cent) and Emaar Development (+1.01 per cent) offered partial relief.

Fundamentally, corporate earnings remained robust. Dewa posted record nine-month revenue of Dh24.9 billion (+5.9 per cent YoY) and net profit of Dh6.8 billion (+24.8 per cent YoY), while Salik reported a 38.6 per cent YoY revenue surge to Dh2.28 billion, underscoring resilience in utilities and toll operations.

Sector-wise, consumer discretionary (-6.89 per cent) and financials (-2.51 per cent) underperformed, while materials (+1.46 per cent) and real estate (+0.95 per cent) bucked the trend.

On the technical front, the index has breached its 50- and 100-day moving averages, with the relative strength index (RSI) slipping below 50, signaling weakening momentum. Experts say support is seen near 5,905, while resistance remains capped around 6,000.

Abu Dhabi Securities Exchange (ADX): Third weekly decline
The ADX General Index extended losses for a third week, falling 1.56 per cent to 9,917.90, below the psychological 10,000 mark. Sector performance mirrored global trends: Technology (-11.82 per cent), real estate (-6.95 per cent), and health care (-4.06 per cent) were major laggards, while consumer staples (+1.77 per cent) was the sole gainer.

Earnings updates provided mixed signals. ADNOC Gas reported quarterly revenue of $5.93 billion and record net profit of $1.34 billion, while Lulu Retail posted steady growth with $1.89 billion in Q3 revenue.

Technically, ADX has slipped below its 50- and 100-day simple moving average (SMA), with next support at the 200-day SMA near 9,818, and resistance around 10,050.

Outlook: Consolidation Ahead
With no major earnings scheduled this week and global sentiment remaining cautious, analysts expect UAE markets to trade range-bound. "Short-term rallies may face resistance unless global risk appetite improves," Valecha noted, adding that selective buying in defensive sectors could offer relative stability.

Khaleej Times