Artificial intelligence (AI) stocks are gaining significant traction among UAE retail investors, while interest in traditional Big Tech and pharmaceutical companies wanes, according to the latest quarterly data from trading platform eToro.
The latest data from a retail investor survey showed 71% of UAE investors own AI-related stocks. Moreover, a majority of investors are also open to AI helping them manage their investments, showing their high levels of trust and engagement.
“The UAE has taken a significant further step in establishing the country as a leader in the adoption of artificial intelligence technologies,” said Ben Laidler, Global Markets Strategist at eToro. “With its own minister for artificial intelligence (AI) setting out a long-term vision as an AI hub at the country’s inaugural retreat in front of 2,500 investors and officials.”
AI on the rise
NVIDIA is the second most popular stock on eToro’s platform in the UAE, trailing only Tesla. The AI chip manufacturer saw a 37% surge in its share price during the second quarter, attracting a flood of new investors, and has become the fifth most owned stock on the platform in the UAE. Nvidia temporarily became the world’s most valuable company in June, after its share price climbed 3.5% to $135.58, lifting its market capitalisation to $3.335 trillion.
Other AI-related stocks also experienced substantial growth. Advanced Micro Devices and Intel saw increases of 29% and 21% respectively. Moreover, foreign investors have been accelerating local investments, led by Microsoft’s recent $1.5 billion investment in G42.
Another source of investor interest has been the crypto boom. A high 74% of UAE retail investors hold crypto assets, “highlighting the country’s progressive regulatory stance and its attractiveness to sophisticated investors,” eToro said. Despite the drop in investor interest in Big Tech stocks, Shopify and Dell Technologies saw the largest increases in holders, up 139% and 45%, respectively.
Declining interest
In contrast with the AI boom, established tech companies faced declining investor interest. Snapchat saw an 11% decrease in holders, while Adobe, Netflix, and Apple experienced drops of 16%, 5%, and 5% respectively. The pharmaceutical sector also saw a downturn, with Moderna, Jaguar Health, and Pfizer experiencing declines of 9%, 6%, and 5%, respectively.
Overall, Snapchat and ZIM Integrated Shipping Services (ZIM.N) experienced the biggest drops, falling 40% and 23% respectively.
With the pandemic’s immediate impact fading and global travel resuming robustly, investor attention is also shifting away from pandemic-driven pharma gains towards sectors poised for substantial post-pandemic growth. This evolving investor sentiment underscores a broader trend of prioritising future-oriented, high-growth sectors over established, but currently less dynamic, industries.