Arabian Gulf shares fell, sending Abu Dhabi index to the lowest level in four months, on investor concern political protests in Egypt will escalate, hurting local companies with investments in the North African country.
Dana Gas, the UAE energy company which produces most of its gas in Egypt, dropped the most since June. In Dubai, Air Arabia, the Middle East’s biggest low cost airline, decreased the most in three months. The ADX General Index retreated 0.4 percent to 2,659.04, the lowest since September 26, at the 2 pm close in Abu Dhabi. The measure declined 0.9 percent this week. Dubai’s gauge fell 0.9 percent and the Bloomberg GCC 200 Index of the region’s stocks lost 0.2 percent.
“Investors are trying to assess the impact on the political front in Egypt with the Pavlovian response being to sell,” said Shehzad Janab, asset management head at Dubai based Daman Investments PSC. “From a broader perspective, this negative is causing risk aversion on the regional markets, which is leading to the selloff.”
Egypt’s EGX30 Index slumped 11 percent, the most since October 2008, to 5,642.24 at 12:17 pm in Cairo, the world’s worst performer. The North African country’s capital Cairo is under heavy security for a second day to prevent the repeat of the January 25 protests, when thousands took to the streets of the capital and major cities to denounce President Hosni Mubarak, inspired by the revolt that toppled Tunisia’s leader.
In the UAE there is concern over local stocks such as Dana Gas and Air Arabia that “could see their business in Egypt impacted by the turmoil,” said Akram Annous, MENA strategist at Al Mal Capital in Dubai.
Dana Gas, which is developing deposits, production and transportation facilities in Egypt, tumbled 4.1 percent to 71 fils. Air Arabia, which has a hub in Alexandria, Egypt, fell 2 percent, the most since November 2, to 83.7 fils.
Crude for March delivery on the New York Mercantile dropped as much 1.2 percent to $86.30 a barrel in electronic trading. The six nations of the Gulf Cooperation Council, including the UAE and Oman, supply about a fifth of the world’s oil.
Qatar’s QE Index and Kuwait’s SE Price Index declined 0.5 percent. Oman’s MSM30 slipped less than 0.1 percent. Bahrain’s BB All Share Index advanced 0.8 percent to the highest since October 13. Saudi Arabia’s market was closed for the weekend.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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