Trading Begins at Stock Exchange in Dubai
DUBAI, United Arab Emirates (AP) - Trading kicked off Monday at the new Dubai International Financial Exchange, which the United Arab Emirates hopes will promote its aim of becoming a global financial hub.The first trades were only in five stock-index certificates as the exchange has no individual company listings. Its first initial public offering is expected to come next month when the Lebanese telecommunications firm Investcom is listed.
The chairman of the exchange, Lynton Jones, said he hopes to have 15 to 20 companies listed on the exchange in the next 18 months. They are expected to come from the Middle East, the Indian subcontinent, China, South Africa and Eastern Europe.
Located in a steel-and-glass building that resembles Paris' Arc de Triomphe, the Dubai exchange is intended to fill a blank space in the trading day. Currently, market activity begins in Asia and jumps over the Middle East to resume on exchanges in Europe and North America.
"We believe the DIFX fills a vacuum by creating an exchange in the heart of one of the world's most dynamic and fastest-growing economies," said Mukhtar Hussein, HSBC Bank's head of Middle East investment banking.
HSBC has signed on as one of four European member banks that will handle IPOs and other market duties.
Local stock markets, which tend to permit only residents to trade, are booming in the Middle East. By contrast, the Dubai exchange is an international market that is open to foreign companies and foreign investors.
The exchange's operators say it will run under the same transparency and regulatory rules that govern the New York and London exchanges.
For now, the market will open Monday through Friday for only three hours a day, between 2 p.m. and 5 p.m. local time.
The five index certificates listed track the U.S. Standard & Poor's 500 Index, Japan's Nikkei 225, Europe's blue chip Dow Jones STOXX 50 and EURO STOXX 50, and Germany's DAX.
