Dubai
As the world continues to fixate on the COVID-19 pandemic, UAE investors too stayed cautious of the risks surrounding the contagion but grew increasingly hopeful of the economy’s prospects in the coming months, a UBS survey showed.
“Naturally, UAE investors remain concerned about the risks of COVID-19,” said Ali Janoudi, Head of MENA Wealth Management at UBS. “However, we are also seeing a slight uptick in economic optimism, with longer-term investment themes such as security and safety, digital transformation and smart mobility attracting particular interest from UAE’s wealthy investors.”
According to the study, which polled more than 4,000 wealthy investors and business owners across 14 markets globally in late June and early July, optimism regarding the economy and the stock market rose compared with the same period three months prior, as the effects of COVID-19 eased.
With a barrage of virus-dominated news, UAE investors have hardly forgotten that there’s a momentous presidential election just a few months away in the world’s largest economy. There have been a surprising number of studies on what elections mean for the markets.
“The US election will likely present numerous opportunities for investors, as well as some clarity over policy direction in the US,” said Solita Marcelli, Chief Investment Officer at UBS Global Wealth Management (Americas). “Regardless of the result, the eventual impact on financial markets is likely to be close to neutral, even if they experience some interim volatility.” The uncertainty of an election can also imply higher risk in certain stock prices, especially those with greater impact to electoral outcomes. This can cause greater volatility in the weeks prior to election day, though, interestingly, the markets can run up in the days immediately prior to an election, even before the outcome is known. According to the UBS survey 64 per cent of UAE investors said they are highly interested in the US presidential election and 85 per cent of the UAE investors plan to adjust their portfolios regardless of who wins the election.
While 55 per cent of respondents said Joe Biden was most likely to win the election, about 45 per cent of them said Donald Trump.—Arab News
