It was revealed yesterday that representatives from both the Dubai Financial Market and the Abu Dhabi Securities Exchange held negotiation talks which are believed to be relating to a possible merger between the two exchanges.
Most now feel that it would be the best possible move for both parties as both have been badly hit by the recession and profits and turnover are at a very low level at present. The Dubai Financial Markets chairman Essa Kazim said he felt it would be in the best interests of all concerned and that there have already been discussions to this effect between both parties.
DFM’s profit margin fell by almost 50% in 2009 and ADX had a worse year seeing their profits slump by about 70% from the previous year. These kind of losses cannot be sustained and many have already questioned the need for three stock exchanges in the UAE the Nasdaq Dubai being the third one in the region all serving a population of five million inhabitants.
Analysts and Entrepreneurs alike now feel that the only way forward for the stock exchange in Dubai is to consolidate to free up liquid assets and restore some confidence in the sector.Paul Holdsworth, Staff Writer, Gulf Jobs Market News