Executives from the Abu Dhabi Securities Exchange (ADX) have moved to assuage big investors’ concerns about the regional security situation and the fall in oil prices.
Rashed Al Baloushi, the ADX chief executive, in New York on an investment roadshow with top American institutions, has told them that the market should be a long-term destination for their funds.
“We are telling them that the UAE and Abu Dhabi have a clear strategy of diversification away from oil, and that we are a friendly, secure place in which to invest,” Mr Al Baloushi said.
“Most sophisticated investors already know what the UAE’s policy and strategy is, and they realise that what happens in Yemen and the rest of the Middle East will affect the whole world, not just the Arabian Gulf. But we still have a job of education to do,” he added.
In a roadshow arranged by HSBC, the ADX team is meeting about 60 American investing institutions in a two-day trip that is to also include a visit to the Nasdaq stock exchange in Manhattan.
The institutions, which include such investment giants as Fidelity, Chase Manhattan and Lazard Asset Management, speak for about $500bn in assets under management, Mr Al Baloushi said.
“We are showing them the opportunities that exist for investment on ADX, and the potential for investment there. We hope to go back with a “wish list” of what US investors want from ADX companies, as well as, hopefully, some direct investment,” he said.
Five ADX traded stock are represented on the roadshow: the property group Aldar; and financial groups First Gulf Bank, National Bank of Abu Dhabi; Union National Bank; and Rakbank.
Mr Al Baloushi will tell US investors of the profit record of quoted ADX companies, with a 17 per cent rise in profits to Dh44bn in the year to the end of March, accompanied by an increase in dividends from Dh17bn in 2014 to Dh18.5bn. “This is what investors are seeking to hear,” he said.
Over the past year, the ADX index has fallen by about 10 per cent, despite the dramatic decline in oil prices by as much as 60 per cent.
The ADX executives also have a meeting scheduled with media tycoon and former New York mayor Michael Bloomberg at which they will discuss cooperation between the two organisations.
“Bloomberg has exposure to all the investors in the world, and ADX would like to share in that exposure. There are big opportunities for cooperation in equities and in bonds,” Mr Al Baloushi said, although details of any cooperation remain to be finalised, he added.