Equity markets in the United Arab Emirates opened Friday on a cautious note, retreating as investors grappled with the prospect of a drawn-out confrontation across the Middle East. The unease, fuelled by ongoing missile and drone exchanges in the region, has begun to seep into financial markets, prompting traders to dial back risk.
Dubai’s benchmark index dropped about 1%, with declines spread across most sectors. Property giant Emaar Properties slipped 1.7%, while banking heavyweight Emirates NBD tumbled nearly 4%, leading the retreat among financial stocks.
The mood turned more defensive as the regional conflict edged closer to its second week. Political rhetoric has intensified alongside the military activity. U.S. President Donald Trump issued sharp criticism of Iran’s leadership, while Iran’s newly installed supreme leader Mojtaba Khamenei warned that Tehran would keep the Strait of Hormuz closed and urged neighbouring states to shut down American bases or risk becoming targets.
Such warnings have stirred fresh anxiety about disruptions to global trade and energy shipments, particularly through the Strait of Hormuz—a narrow waterway that handles a significant share of the world’s oil exports.
Adding to the tension, authorities in Dubai reported minor structural damage to a building façade in the city centre after debris from an intercepted aerial object fell nearby. Officials said there were no injuries. A witness indicated the incident occurred close to the Dubai International Financial Centre.
Losses were also pronounced in the capital. The main index in Abu Dhabi slipped 1.4% amid widespread selling. The country’s largest lender, First Abu Dhabi Bank, dropped 3.8%, while property developer Aldar Properties declined 2.5%.
With geopolitical tensions overshadowing corporate fundamentals, traders across Gulf exchanges are bracing for continued volatility as the regional situation evolves.
