Shuaa weighs heavy on Dubai index

STOCKS LATEST: Most Gulf markets were heading towards a lower close on Tuesday. (Getty Images)

Dubai's index closed lower for a second day, with Shuaa Capital shares slumping as a row with Dubai Banking Group deepens.

Shuaa jumped 14.5 percent intraday after the investment bank said it had issued 250 million shares to try to settle a long-running dispute with Dubai Banking Group over a 1.5 billion dirham ($408.5 million) convertible bond.

But Dubai Banking Group swiftly said it would not accept delivery of the conversion shares, sending Shuaa tumbling, closing down 1.7 percent.

A statement from the Dubai Financial Market said it would not register the new shares in Dubai Banking Group's name until it receives written request to do so from both parties.

Emaar Properties also declined, falling 1 percent. This helped drag the benchmark down 0.2 percent to 2,138 points, although late buying enables it to rebound from an intraday low of 2,091 points. Volumes fell by a third from the day before.

Saudi Arabia's index ended slightly higher as a recovery in global stocks and rising oil prices helped the kingdom's stock recover from earlier losses.

Saudi Basic Industries Corp (SABIC) climbed 0.7 percent, buoyed by oil's rise towards $72 a barrel after falling below $70 on Monday.

Banks continued to struggle as investors fretted over potential losses from two troubled family-owned Saudi conglomerates.

SABB fell 2.4 percent and Arab National Bank slid 1.8 percent as the index edged up 0.2 percent to 6,062 points.

Kuwait's index ended lower for the first session in three, dragged down by losses in its six largest stocks as the controversial sale of a stake in Boubyan Bank was halted by a court order.

National Bank of Kuwait (NBK) dropped 1.5 percent and Commercial Bank (CBK) lost 1.8 percent. NBK has agreed to buy CBK's stake in Boubyan Bank, but a Kuwait court has suspended the deal after Investment Dar filed a lawsuit to stop the sale.

Boubyan Bank fell 3.8 percent.

Mobile Telecommunications Co (ZAIN) fell 1.8 percent. This takes its losses to 5 percent since hitting a seven-month high on June 8 as investors await news on the fate of its African operations, amid persistent rumours these will be sold.

Bahrain's index ended higher for a third straight session, rising 0.2 percent.

Qatar's index ended lower for a second day in its largest one-day reverse for three weeks as weakening regional and global sentiment weighed on stocks.

The benchmark slid 2.9 percent to 7,083 points as 19 of its 20 stocks fall. Barwa Real Estate fell 4.9 percent, Qatar Commercial Bank lost 4.2 percent and Doha Bank fell 2.8 percent.

Oman's index ended higher for a second session running, buoyed by banks.

Oman International Bank (OIB) surged 8.4 percent. Tuesday's gains mean OIB has climbed 8.8 percent since the end of February, while Oman's index has soared 17 percent over the same period.

Bank Muscat rose 1.4 percent after saying it would sell its remaining 0.5 percent stake in India's HDFC Bank within 30 days.

Muscat's benchmark climbed 0.6 percent to 5,687 points.

Abu Dhabi's index closed lower for a second day in its largest one-day loss since April 27 as banks, property and telecoms slump

Volumes fell by nearly half as the benchmark drops 2.2 percent to 2,860 points.

Emirates Telecommunications Corp (Etisalat) fell 2.3 percent, National Bank of Abu Dhabi dropped nearly 5 percent and Aldar Properties lost 3.2 percent.

On Monday, the UAE's central bank governor said domestic banks had exposure to Saudi Arabia's troubled Saad Group and Ahmad Hamad al-Gosaibi & Brothers Co.

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