Gulf exchanges suffer further losses

Arab stock markets tumbled for the fourth day running on Wednesday amid growing fears that policymakers may be powerless to stop the worst financial shock since the Great Depression.

The fall slashed many more billions from the combined value of regional markets to add to big losses chalked up in the past three days as concerns mounted about the impact of the global financial crisis on the oil-rich region.

Dubai's main index closed more than 8 percent down on Wednesday with Emaar Properties and Etisalat among the high-profile casualties.

Emaar declined 7.41 percent while Etisalat lost 9.93 percent to end trading at 13.15 dirhams, its lowest level since April 2007.

The Dubai benchmark closed 8.43 percent lower to 3,085 points while the Abu Dhabi index finished down 6.43 percent at 3,176 points.

Emaar, which said on Tuesday that it had yet to begin its share buyback programme but would commence repurchases after posting its third-quarter profits, earlier saw shares sink by more than 13 percent before a small rally late on Wednesday.

On the third day of property exhibition Cityscape Dubai, other real estate shares also suffered with Aldar Properties down 9.7 percent and Sorouh Real Estate plummeting 9.75 in Abu Dhabi, and Union Properties and Deyaar Development both down by more than 11 percent in Dubai.

Banking stocks also plunged in both Dubai and Abu Dhabi, with Dubai Islamic Bank tanking 12 percent and National Bank of Abu Dhabi (NBAD), Abu Dhabi Commercial Bank (ADCB) and First Gulf Bank showing losses of more than nine percent.

Sherif Abdul Khalek, institutions accounts manager at Beltone Financial Services, said stocks were being driven down by international investors pulling out due to the global financial crisis and concern among local investors that the global liquidity squeeze was starting to hit the UAE.

Khalek forecast stocks would continue to drop in the coming days, but did not expect authorities to step in and stop trading. He said real estate stocks had been the hardest hit because they were the most liquid in the market.

"We need more clarity that companies in the region are not going to be affected by the global problems. We need more transparency and clarity, this will give confidence to the market," Khalek told Arabian Business.

Saudi Arabia's main index narrows losses, closing more than 1 percent lower as Saudi Basic Industries Corp. (SABIC) surges after global rate cuts.

Central banks around the world, including the US Federal Reserve, European Central Bank and the Bank of England as well as the Kuwait and United Arab Emirates' banks, cut their interest rates on Wednesday, prompting global stocks around the world to scale back losses suffered during the session.

SABIC surged 5.26 percent and Al-Rajhi Bank gained 4.84 percent. The benchmark ended down 1.49 percent at 6,160 points, after falling as much as 8.91 percent in trading.

Kuwait's main index ended lower but scaled back some losses suffered earlier in the session, with banking stocks mixed.

The central bank of Kuwait cut its key discount rate by 125 basis points on Wednesday.

Kuwait Finance House rose 3.19 percent, while National Industries Group and Gulf Bank fell 6.58 percent and 3.64 percent respectively as the benchmark lost 1.41 percent to 11,472 points.

Elsewhere in the Gulf, Qatar's benchmark fell to an eight-year low after dropping by nearly 9 percent while Oman fell by more than 7 percent and Bahrain's dropped by 2.7 percent.