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DFM Plummets, UAE losses $42b Overall

DUBAI — The Dubai Financial Market plunged a further 8 per cent on Wednesday, following other haemorrhaging stock markets lower as concerns deepened that the global credit crisis could drag the world’s economy into recession.

Dubai and Abu Dhabi markets have cumulatively lost $42.6 billion in market captalisation during the past four trading sessions.

Overall, GCC bloc markets — including Bahrain, Saudi Arabia, Kuwait, Oman, Qatar and the UAE — have lost $186.3 billion in market capitalisation since September 29.

Dubai’s benchmark stock index shed 283.13 points, or 8.43 per cent, to end trading at 3,085.02.

The index has lost more than a quarter of its value since Sunday.

The Abu Dhabi Securities Exchange’s (ADI) General Index fell 218.37 points, or 6.43 per cent, to 3,176.94 points.

After the markets closed, the UAE central bank announced a cut in its overnight repurchase rate by 50 basis points to 1.5 per cent, following a similar cut by the US Federal Reserve and other Western central banks.

“The market followed the global phenomenon,” Aamir Peracha, director equities and derivatives, at Mashreq Securities, told Khaleej Times.

Real estate and banking stocks led the declines.

Both sectors lost 8.94 per cent and 6.82 per cent, respectively.

“The banking sector here will also face a lot of scrutiny and investors fear the real-estate sector is a bubble,” Bloomberg quoted Vyas Jayabhanu, head of Al Dhafra Financial Brokerage LLC, as saying.

Emaar Properties, the Middle East’s largest real-estate developer by market value, fell 7.4 per cent to Dh5.5 while Aldar Properties, Abu Dhabi’s biggest developer, slid 9.7 per cent to Dh5.49.

Dubai Islamic Bank slumped 12 per cent to Dh4.4, while Emirates NBD, the country’s biggest bank, lost 5 per cent to Dh7.4.

All Gulf markets, including Saudi Arabia, Kuwait, Qatar and Oman, registered declines after dramatic falls in Japan, the UK and other developed markets.

The MSCI World Index of 23 developed markets lost 2.9 per cent, taking its five-day fall to 15 per cent, its largest decline on a closing basis since October 1987.

imranmaqbool@khaleejtimes.com