Good morning, everyone. We kick off today’s issue with plenty of activity in debt markets: Abu Dhabi reopened previous issuances, raising another USD 2.5 bn offering, while Dubai Islamic Bank is the latest Gulf bank to price its AT1 issuance yesterday, drawing in orders north of USD 2.3 bn. Meanwhile, DP World is meeting with investors to reassure them that it’s good to pay its debt.
Deployment is equally active, with BlueFive Capital making yet another acquisition in the mobility space, ADIC backing New York-based hedge fund ExodusPoint’s USD 2 bn capital raise, and another L’imad reshuffle happening as the sovereign wealth fund acquires 2PointZero’s stake in Taqa.
On the downside: Fitch is turning much more bearish on the region’s credit, citing lasting security and business risks due to ongoing geopolitical tensions, and turning its sovereign outlook from neutral to deteriorating.
BUT BEFORE WE DIVE IN- Iran launched strikes in Bahrain targeting the US Fifth Fleet — Bahrain’s Interior Ministry sounded the alarm and told the public to seek shelter. Shortly after, Kuwait said it was intercepting aerial targets.
It does not appear the attacks have reached the UAE as of dispatch time — we’re yet to hear from our Defence Ministry, but we’ll be closely watching our phones over the coming few hours for any public safety alerts.
This came after the US launched a fresh wave of attacks on Iran last night and threatened to continue the attacks if Tehran doesn’t sign the peace agreement. US President Donald Trump said Iran would “pay the price” for dragging out negotiations.
The state of Hormuz is unclear, with contradicting reports from Iran and the US. State-run Iranian media said the waterway has been closed to all vessels, while the US said commercial ships are continuing to transit.
WEATHER- Look for a high of 41°C in Dubai and Abu Dhabi, while the former will see a low of 29°C and the capital a low of 31°C.
Emirates’ Tim Clark goes on PR offensive
Emirates will offer “all sorts of incentives other than price” to lock in hesitant travelers, including safety assurances and contingency arrangements for stranded passengers, CEO Tim Clark told Reuters on the sidelines of an industry summit in Berlin — his first interview with a global news agency since the conflict began in late February. Clark said ticket prices can’t come down while oil is fluctuating, but predicted that once crude falls from around USD 90 to USD 70, “we’ll be back.”
The broader industry picture is grimmer. Middle Eastern airlines are expected to swing to a collective USD 4.3 bn loss in 2026 — the only region projected to slip into the red this year, per the IATA — with passenger demand forecast to drop 11.4% as airspace closures, longer routings, and elevated fuel costs bite. Gulf carriers’ heavy dependence on east-west transfer traffic through Dubai, Doha, and Abu Dhabi makes the connectivity hit particularly costly.
Both UAE carriers are nonetheless pushing a growth narrative. Etihad is placing a double-digit order for widebody aircraft and expects to be flying about 8% more than a year ago by mid-June, while Emirates — heavily hedged on fuel — had three-quarters of its flights operating at pre-conflict capacity as of May.
ADIC keeps deploying
Abu Dhabi capital is continuing to flow into hedge funds despite the regional backdrop: New York-based multistrategy hedge fund ExodusPoint Capital Management raised USD 2 bn in fresh capital, with the Abu Dhabi Investment Council (ADIC) among the backers, Bloomberg reports, citing people it says are familiar with the matter. The fundraising boosts ExodusPoint’s assets under management to USD 14.5 bn and marks its first capital raise since 2023.
Why now? The fundraising follows ExodusPoint’s strongest year on record, with returns of 18% in 2025, as the firm expanded its equities business alongside its fixed-income operations.
IN CONTEXT- The investment comes as ADIC ramps up its exposure to alternative assets under CEO Saeed Al Mazrouei. The Mubadala-owned fund, which manages roughly USD 160 bn, has been expanding into areas including hedge funds, private credit, ins., and secondaries while looking to deploy more than USD 10 bn over the next three years.
DP World moves to reassure investors
DP World is trying to reassure bond investors it can weather the war. The company’s management has been meeting local and international fund managers ahead of an EUR 750 mn bond maturing in September, Bloomberg reports, citing people familiar with the matter. The company has the money to repay it outright, but would prefer to refinance in the market if conditions allow.
It has numbers to support it: Jebel Ali volumes dropped 30% y-o-y in 1Q 2026, though that only captures one month of full Hormuz disruption. Fitch expects DP World to manage its USD 2.6 bn in 2026 maturities through a combination of capital markets access and available liquidity.
More dual listings for Abu Dhabi
ADX expects between two and three companies to pursue dual listings before year-end, with technology and healthcare firms currently working through regulatory approvals in their home markets, CEO Abdulla Al Nuaimi told the Arabic press (watch, runtime: 06:01).
Who could be next? ADX hasn’t identified the companies, but Hong Kong-listed biotech firm Insilico Medicine was previously reported to be planning a secondary listing in Abu Dhabi. The exchange has also been stepping up efforts to attract overseas issuers, including through a partnership with Hong Kong Exchanges and Clearing focused on dual listings and cross-border financing.
Why now? Foreign investors accounted for more than 47% of trading value on the ADX during the first four months of 2026, according to Arabian Gulf Business Insight, while Abu Dhabi-listed companies reported USD 10.6 bn in 1Q earnings.
Data point
The UAE’s federal government ended 2025 with an AED 17.4 bn surplus, KhaleejTimes reports, citing final accounts approved by the Federal National Council. Revenues reached AED 86.3 bn last year against expenditure of AED 68.9 bn, with operational revenues accounting for 61% of the total.
Why it matters: The surplus offers a snapshot of the fiscal strength the UAE brought into 2026. That resilience has helped underpin recent ratings affirmations from both Moody’s and S&P despite a more challenging regional backdrop.
Where the money came from: Government company earnings generated AED 12.1 bn, while identity, visa, and residency services brought in AED 12 bn. Work permits and labor cards contributed another AED 9.8 bn, while telecommunications concession fees generated AED 6.9 bn.
The balance sheet remains strong: Federal assets stood at AED 569.8 bn at year-end, with net assets of AED 429 bn.
Where it went: Salaries and benefits accounted for AED 29 bn of spending, while public services received AED 19.3 bn and education AED 16.3 bn. Healthcare spending reached AED 5.6 bn and social protection expenditure totaled AED 7.1 bn.
The big story abroad
Global headlines are focused on the latest exchange of attacks between the US and Iran, which we dive into in the news well, above.
Looking at the markets: Oil jumped on the news, with Brent crude rising over 2% to USD 95.14. Asian markets opened lower — extending losses initially triggered by a tech selloff — and in the US, equities are on track to open in the red with futures down in response to the attacks.
Speaking of US markets: The country saw inflation pick up in May, recording 4.2% — its highest level in three years — on the back of rising energy costs, making a rate hike from the Federal Reserve appear increasingly likely. Commenting on the figure, Trump said, “I love the inflation,” promising that “oil [will] drop to where it was before [the war].”
The 2026 World Cup kicks off tonight with a showdown between South Africa and Mexico starting at 10pm. To better acquaint yourself with the players, check out The Athletic’s list of 200 players to watch at the 2026 World Cup.
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