ADX gained over 20 per cent and DFM 4.4 per cent in 2022: CBUAE

The Central Bank of the UAE (CBUAE)’s Financial Stability Report for 2022 said the FTSE ADX General Index (FADGI.FGI) gained more than 20 per cent in 2022.

The Abu Dhabi Securities Exchange (ADX) trading value increased by 21.9 per cent to Dhs451 billion.

It its overview of UAE stock markets in 2022, the CBUAE report noted this increase was driven by higher levels of domestic and international investment. Foreign investment in ADX increased, with total net foreign investments recording an inflow of Dhs24 billion in 2022. In addition, net institutional investments inflow reached Dhs8 billion. ADX market capitalisation increased by 61.4 per cent in 2022 to Dhs2.62 trillion. The increase was supported by a series of listings. In 2022, ADX listed 18 securities, including shares, bonds, warrants, and investment funds. In the first 12 months since its launch, the ADX derivatives market achieved Dhs1 billion in traded value, with more than 1 million contracts traded.

In 2022, ADX partnered with FTSE Russell to create new benchmark indices. ADX adopted FTSE Russell’s Industry Classification Benchmark (ICB) for all its listed equities, and co-developed the FTSE ADX Growth Market Index (FADGMI) to track the performance of the ADX Growth Market segment.

During the year, ADX and the Bahrain Bourse also announced the launch of the region’s first digital exchange hub - Tabadul.

The Abu Dhabi Securities Exchange has partnered recently with Mashreq Securities to simplify and streamline the digital onboarding process for Mashreq customers, providing them with instant access to trading on the Exchange. The partnership was formalised through a memorandum of understanding (MoU) with Mashreq and an access and process agreement with Mashreq Securities.

As part of the agreement, ADX and Mashreq will collaborate to introduce a straightforward process for individuals to obtain a National Investor Number (NIN) and set up a trading account. The new process will eliminate the need to print, sign, and email documents, using a secure digital platform.

The Dubai Financial Markey (DFM) General Index increased by 4.4 per cent in 2022, as total trading value increased by 24.8 per cent,reaching Dhs90 billion. Similarly, DFM market capitalisation increased by 41.7 per cent to over Dhs580 billion in 2022. Foreign investor confidence in DFM was positively impacted, as total net foreign investments recorded a value of Dhs5 billion, a growth of 167 per cent. Institutional investment inflow in DFM increased by almost 205 per cent. Trading of derivatives was active, with approximately Dhs900 million in traded value and 1 million contracts traded.

The Dubai Financial Market Company reported a 41.7% increase in net profit for the fiscal year ending December 31, 2022, reaching Dhs147.1 million compared to Dhs103.8 million in 2021.

The company also reported a 19% increase in total revenue, reaching Dhs351.2 million. In the fourth quarter of 2022, the company posted a net profit of Dhs58.1 million and total revenue of Dhs113.4 million. The Board of Directors approved the annual results and recommended a cash dividend of Dhs134.7 million, equivalent to 1.68% of the capital. The Board also recommended a new fixed dividend policy, stipulating that the company distributes a minimum of 50% of its net profit annually.

Helal Al Marri, Chairman of DFM Company, commented on the company’s achievements in 2022, stating that the year was promising for DFM. He attributed the strong results for the fiscal year to the strength of the company’s operating model and progress made in transforming the business, pursuing new opportunities, and developing UAE capital markets.

Al Marri believes that DFM’s modern infrastructure, innovative regulations, and dynamic business model will drive sustained growth and position Dubai as a hub for global financial activity.

Helal Al Marri continued, saying that DFM’s focus on capital market development strategy has produced results, making DFM a leader in new IPOs and listings with 5 successful IPOs of government-related and private companies. He also highlighted the launch of a new general index that provides best practices for indices and greater transparency for investors.

Al Marri also mentioned DFM’s efforts to diversify asset classes with the introduction of crude oil contract trading (Micro Oman Crude Oil Futures) and the launch of new equity futures, positioning DFM as one of the leading regional markets in terms of investment opportunities and asset class diversity.

DFM had a strong close to the year with a 24.5% increase in trading value to Dhs90 billion compared to 2021, and a 41.4% increase in market capitalization of listed securities to Dhs582 billion. The DFM General Index also rose by 4.4%. Foreign investors accounted for 48.7% of DFM’s trading value with net purchases of Dhs5 billion and held 19% of the market capitalization at the end of the year.