Geopolitical risk premium in the Middle East has receded, and the Dubai stock market is set to achieve its best quarterly performance in a year.

The ceasefire in the Middle East conflict is attracting investors back, and the Dubai stock index is expected to record its best quarter in nearly a year. The Dubai Financial Market General Index rose by about 11% in the second quarter, erasing the losses from earlier in the year, but the index is still far below the levels before the conflict broke out. Salah Shama, the Middle East and North Africa stock investment manager at Franklin Templeton, stated that if a permanent ceasefire agreement is reached, combined with strong local policy support, Dubai could regain its attractiveness to both population and capital.