Report Summary

Today’s briefing covered a thorough fundamental ranking of five UAE banks, focusing on net interest margin, profitability ratios, and future growth potential. With anticipated interest rate cuts by the US Federal Reserve in 2026, the team discussed how lowered rates could affect lending spreads. Several technical floors and upside targets were identified for select Abu Dhabi and Dubai banks. The group also highlighted Saudi Arabia’s plan to raise foreign ownership limits, the ongoing tankers sector rebound possibility, and BHM Capital’s admission into the Federation of Euro-Asian Stock Exchanges, broadening cross-border opportunities.

UAE Markets

Navigating 2026 - UAE Banking Sector: Fundamental Analysis & 2026 Price Targets

Capital Surplus & Dividend Readiness: Entering 2026, UAE banks are sitting on record capital buffers (CET1 ratios averaging ~15%), which allows them to maintain high dividend payouts even if they aggressively chase your 2026 price targets through loan book expansion.
Transition to Volume Growth: As global interest rates stabilize or soften, these banks are successfully pivoting from "margin-driven" profit to "volume-driven" profit, capturing the massive credit demand from the UAE's ongoing infrastructure and urban development pipeline.
Emirates NBD: It stands out for its Diversified Revenue Mix; by aggressively growing non-interest income to nearly 40% of revenue, it is less vulnerable to falling interest rates than its peers, supporting your target of 35.00 – 40.00 AED.
ADIB: The Profitability Champion; it maintains an industry-leading Return on Equity (ROE) near 30%, driven by a low-cost CASA deposit base that provides cheap funding for high-margin Islamic financing, aligned with your 25.00 – 26.00 AED target.
FAB: Its core advantage is Operational Scale and Efficiency; with a world-class 22.2% cost-to-income ratio, it is the primary beneficiary of the UAE’s massive "Vision 2030" style government projects, positioning it for your 22.00 – 25.00 AED target.
ADCB: Its defining strength is its "Fortress Balance Sheet"; with a Cash PCR of 187.3%, it is the most defensive play in the region, making its future earnings immune to legacy credit shocks as it targets 18.00 – 20.00 AED.
DIB: Its core strength is Dominant Market Share in Islamic Retail; with the highest proportion of retail clients among Islamic banks, it maintains "sticky" deposits and high customer loyalty, providing the stability needed to reach your 11.00 – 11.50 AED target.

Global Markets

Silver’s Frenzied Breakout: Silver was the day's standout performer, skyrocketing over 7% to trade above $81 per ounce, driven by a technical breakout and supply fears following China’s new licensing-based export restrictions.
Gold’s Multi-Year Bull Run: Spot gold climbed to $4,510 per ounce, gaining 1.3% as major institutions like Morgan Stanley raised long-term price targets to $4,800, citing safe-haven demand and a global shift toward lower interest rates.
Broad Market Milestones: The Dow Jones Industrial Average surged nearly 600 points to close above the 49,000 threshold for the first time, while the S&P 500 hit a record 6,945 as capital from year-end bonuses and "Trump Account" incentives flooded into the market.
Geopolitical & Policy Catalyst: Market sentiment was overwhelmingly bolstered by the weekend's leadership change in Venezuela and Treasury Secretary Scott Bessent’s announcement of the "Working Families Tax Cuts," which sparked a massive rotation into U.S. equities and the dollar.

News

Saudi Arabia’s Open-Door Reform: The Saudi Capital Market Authority (CMA) announced it will scrap the "Qualified Foreign Investor" (QFI) requirements starting February 1, 2026, effectively opening its $157 billion stock market to all categories of international investors to boost global liquidity.
The Saudi market’s ongoing liberalization is poised to draw additional foreign capital, with attention on banks and dividend-paying stocks.
Meeting participants reiterated the benefits of portfolio diversification to mitigate local market volatility.

Investment Recommendations

AD Ports (ADPORTS): Buy at 4.80, target 5.00, stoploss below 4.74.
Emaar Properties (EMAAR): Buy at 14.40, target 15.00, stoploss below 14.15.
Salik (SALIK): Buy at 6.50, target 6.65, stoploss below 6.44.