Markets dip with investors wary of travel ban imposed by Trump

31/01/2017 06:59 AST

Global equities markets began the week lower on Monday, as immigration curbs by the US president Donald Trump rattled investors.

President Trump’s executive order to ban all nationals from seven Muslim-majority countries from entering the US has sparked mass protests across the country, and has drawn widespread condemnation from tech firms including Google, Netflix, Apple and Microsoft.

The Euro Stoxx 50 was down by about 1 per cent in early trading on Monday, and was 1.2 per cent lower in the late afternoon. The UK’s FTSE 100 was off by about 0.8 per cent. Earlier in the day, the Nikkei closed 0.5 per cent lower. Futures markets meanwhile pointed to a lower opening for US equities.

"US stocks are likely to be under pressure following Trump’s executive orders, given the uncertainty this presents for markets," said Nayal Khan, head of institutional trading at Saudi Fransi Capital in Riyadh.

Emerging markets also trended lower, as US immigration policies increased concerns over global economic growth and curbed risk appetites.

"US president Trump’s travel ban against seven predominantly Muslim countries is a signal that has economic consequences," said Paul Donovan, global chief economist at the Swiss lender UBS in London.

"The signal from the original act persists even if the original act is subsequently modified."

Mr Donovan speculated that president Trump’s travel ban may lead to a sell-down of US assets by investors across the Arabian Gulf.

"If [regardless of intent] the signal is perceived as anti-Muslim, Middle Eastern investors may question the security of their US investments," he said. "Middle Eastern investors have already been selling US assets to fund the purchase of European goods and services. This flow could accelerate."

Meanwhile, shares in the UAE held their ground on Monday amid sell-offs across the Gulf region, thanks to a series of positive results.

The Dubai Financial Market General Index finished up 0.3 per cent at 3,678.79, on the back of a record rise by Aramex.

The logistics company’s shares soared 9 per cent to an 11-year high of Dh4.50, as cross-border e-commerce contributed to a 37 per cent rise in the company’s net profit for 2016.

Dubai Investments and Arabtec were among the other big-name gainers, rising 2 per cent and 3 per cent respectively.

Shares in Abu Dhabi closed up 0.1 per cent at 4,590.88, on the quietest day of trading on the capital’s bourse of the year so far.

Shares in Agthia were up 0.9 per cent at Dh6.90, after the food and beverage company posted a 4 per cent rise in fourth quarter net profit.

Waha Capital shares fell 0.4 per cent to Dh2.29, after the investment firm announced a 30 per cent fall in annual earnings.

In Saudi Arabia, the Tadawul began the day little changed, but fell in afternoon trading, closing down 0.7 per cent.

The National