Emaar shares slump 10% on merger plan

Emaar Properties plunged after announcing merger plans, dragging Dubai's index to its biggest one-day fall for seven months.

Emaar dropped 10 percent, its largest single-session decline since Nov. 18, after saying it would merge with three real estate units of Dubai Holding, which is owned by Dubai's ruler.

"This deal is a giant question mark, that's why the stock is down today," said Robert McKinnon, Al Mal Capital managing director of equity research.

"Stock markets don't like uncertainty and Emaar would have been better off if it had kept this quiet until the details were sorted out.

"Without knowing the impact on shareholders, people want to avoid Emaar's stock. The company says the merger will take four months to complete and the stock will be under pressure in the near term."

Dubai's index fell 6.1 percent to 1,745 points as 18 stocks fell by more than 4 percent.

Abu Dhabi's benchmark ended lower for a sixth straight session as banks and property companies tumbled. Volumes fell to a four-week low.

Aldar Properties and Sorouh Real Estate both plunged more than 9 percent.

Abu Dhabi Commercial Bank fell 6.7 percent, taking its losses to 13.5 percent in the two sessions since a banking source said the lender is owed at least $500 million by the troubled Saad Group and Ahmad Hamad Algosaibi Group & Bros.

Qatar's index ended lower for the first time in three sessions, while the Kuwait and Bahrain benchmarks also retreated as Gulf Arab stocks declined on weakening oil prices and concerns about bank write downs.

Qatar National Bank and Qatar Commercial Bank fell 2.7 and 3.1 percent respectively.

Property stocks supported, with Barwa Real Estate rising 1.1 percent and Qatar Real Estate Co climbing 0.4 percent.

Top trader Masraf Al Rayan advanced for a fifth day, adding 0.8 percent. Qatar's benchmark fell 1.2 percent to 6,579 points.

Saudi Arabia's index closed lower for the seventh session in eight as banks and petrochemicals headed losers.

Saudi Basic Industries Corp (SABIC) fell 3.8 percent, Al-Rajhi Bank lost 2.4 percent and Samba Financial Group dropped 4.3 percent.

The benchmark dropped 2 percent to 5,490 points, a two-month low.

Kuwait's index ended lower for a second trading day, slipping 0.6 percent to 8,096 points as volumes slipped to a 16-week low.

"Volatility in Kuwait will continue to be lower than in Dubai and Qatar and should hold around current levels at least until second quarter results come out from the second week in July," said Shahid Hameed, Global Investment House head of asset management for the Gulf region.

Ahli United Bank dropped 2.5 percent and Mobile Telecommunications Co (ZAIN) lost 1.7 percent.

Bahrain's benchmark closed lower for a fifth straight session, falling 1.5 percent to 1,589 points, its biggest one-day decline for more than two months.

Oman's index ended lower for the fourth session running as bank stocks tracked declines across the Gulf Arab region.

Oman International Bank fell 2.2 percent, while Bank Muscat and National Bank of Oman lost 2.4 and 0.7 percent respectively

The index fell 1.1 percent to 5,632 points, its lowest finish for two weeks.

Banks and petrochemicals weighed on Saudi Arabia's index as falling oil prices and potential exposures to two troubled Saudi conglomerates dampened investor sentiment.

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