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Barclays says investors should buy Dubai bonds as refinancing risk eases
Source: BI-ME and Bloomberg , Author: BI-ME staff
Posted: Sat November 7, 2009 12:04 am
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INTERNATIONAL. Investors should buy Dubai sovereign bonds as the emirate seeks to refinance its maturing debt with the help of oil-rich Abu Dhabi and as it focuses on an 'orderly exit from the crisis,' reported Bloomberg, citing a Barclays Capital report.

“We consider Dubai credit as attractively priced at current levels,” London-based analysts including Alia Moubayed wrote in a report dated November 4. “We recommend a long position in Dubai sovereign credit,” and see yesterday’s negative price actions as an opportunity to buy, the report said.

The cost of protecting Dubai bonds from default rose 1.8% to 314 basis points Wdnesday, the highest in about two months, five-year credit-default swap prices show.

Dubai borrowed US$10 billion by selling bonds to the country’s central bank in February, and may raise another US$10 billion in November, Mohammed Alabbar, who headed the government committee evaluating the impact of the credit crisis on Dubai, said last month.

The emirate’s ability to raise the second $10 billion with the support of Abu Dhabi and the likely repayment of Nakheel's Islamic bonds of US$3.52 billion due in December will help its debt, Barclays said. The analysts prefer the emirate’s newly issued Islamic dollar and dirham bonds.

Dubai on October 28 raised US$1.93 billion in its first Islamic bond sale, the biggest from the Gulf region this year.

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MIDDLE EAST BUSINESS COMMENT & ANALYSIS

date:Posted: November 19, 2009
INTERNATIONAL. A majority of investors expects the US Federal Reserve to hold off from raising interest rates until the second half of 2010, according to the BofA Merrill Lynch Survey of Fund Managers for November.
date:Posted: November 19, 2009
INTERNATIONAL. Faber said, considering the size of the stimulus packages and the monetary printing, the US economy hasn't responded well. What have responded well are asset markets but unemployment is horrrible and the typical household is suffering.
date:Posted: November 18, 2009
INTERNATIONAL. The global health industry is worth around US$4.2 trillion. As GCC countries continue to develop world class healthcare systems, they must avoid pitfalls of the developed markets, according to AT Kearney.
UAE. Dubai ruler Sheikh Mohammed Bin Rashid Al-Maktoum tightened the control of the emirate's largest holding company, the Investment Corporation of Dubai.