Report Summary

Global indices are near pivotal technical levels as both the S&P 500 and Nasdaq hover at wedge boundaries, suggesting a possible short-term correction of around 5%. In the UAE, attention centers on ADNOC-affiliated stocks, with ADNOC Gas showing promising momentum for 2026. Borouge also sees sustained buyer interest near key support. Today’s key picks include ADNOC Gas, Borouge, and ADNOC Drilling, each presenting potentially significant upside based on current fundamentals and technical patterns.

UAE Markets

Navigating 2026: ADNOC Groups - Outlook and 2026 Targets

ADNOC Drilling: Targets a price of 7.00 by 2026. This is supported by its mandate to deliver 13 new Integrated Drilling Services (IDS) packages by year-end 2026 and its rapid advancement of the unconventional energy program, which aims to scale to over 300 wells annually across Abu Dhabi.
ADNOC Gas: Aims for a 2026 target of 4.50. The company’s fundamentals are underpinned by a landmark 20-year, $40 billion gas supply agreement with Ruwais LNG and a commitment to a 5% minimum annual dividend growth through 2030, supported by its virtually debt-free balance sheet.
ADNOC L&S: Sets a 2026 performance target of 8.00. Following its fleet expansion—including the delivery of next-generation LNG carriers like 'Al Sadaf'—the company has reset its dividend baseline to $325 million and is projecting a 52% increase in annual dividends by 2030.
ADNOC Distribution: Targets 4.50 on the condition that it breaks the 4.00 resistance level. To support this, the company is shifting to a quarterly dividend schedule starting in Q1 2026 and has upgraded its station network guidance to 1,150 locations by 2028, with a heavy focus on expansion in Saudi Arabia.
Borouge: Projects a target of 3.50 on the condition that it breaks 2.65. Key to this move is the expected completion of the Borouge-Borealis merger in Q1 2026 to form "Borouge Group International," which will be the world’s fourth-largest polyolefins company with a targeted 90% dividend payout ratio.
Fertiglobe: Aims for a target of 3.00 on the condition that it breaks 2.65. Now a majority-owned ADNOC subsidiary, its 2026 outlook is tied to the "Grow 2030" strategy, which targets $1 billion+ in EBITDA by 2030 through low-carbon ammonia growth and a $55 million cost-reduction program.

Global Markets

Positive Rebound Driven by Tech: Markets snapped a two-day losing streak, with the S&P 500 rising approximately 0.27% to close at 6,945 and the Nasdaq Composite gaining 0.25% to finish at 23,530. This bounce was largely fueled by a rally in semiconductor stocks following strong earnings and massive future investment plans from industry leaders like TSMC.
Wedge Pattern Formation: Technically, both the NASDAQ 100 and S&P 500 are currently trading within a "rising wedge" pattern. This is a visual "squeezing" of price action where the market makes higher highs and higher lows, but the range is getting tighter and tighter, suggesting that the current upward momentum is beginning to lose steam.
The "Momentum Flush" Risk: Analysts are watching the lower support line of these wedges closely. Because the market has been heavily driven by "leveraged" trades (money borrowed to bet on further gains), a break below this bottom line could trigger a "momentum flush," where investors are forced to sell quickly to cover their positions.
Potential 5% Correction: If these indices break to the downside, market strategists anticipate a healthy but sharp 5% correction. In layman's terms, this would act as a "reset" for the market, cooling off the recent hype and bringing prices back down to more sustainable levels before the next potential move higher.

News

AD Ports Group has signed an AED 840 million land sale agreement with Danube Properties for 1 million sqm in the KEZAD Town Centre, a move designed to accelerate land monetization and generate cash flow to deleverage its balance sheet.
ADNOC is considering a strategic entry into Venezuela's natural gas sector through its international investment arm, XRG, seeking to leverage Abu Dhabi's oil wealth to finance projects alongside a partner with regional expertise, contingent on established legal and financial frameworks.

Investment Recommendations

Dubai Financial Market (DFM): Buy at 1.65, target 1.75, stoploss below 1.63.