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Sun 24 Jan 2010 10:22 AM

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Dubai index slumps to fresh six-week low

UPDATE 8: Emaar plunges 9.7% to six-week low, dragging index to lowest end since Dec 9.

Emaar Properties plunged to a six-week low as Dubai stocks were routed following an end-of-week sell off on global markets.Emaar dropped 9.7 percent to 2.97 dirhams, its lowest close since December 10. Arabtec fell 8.1 percent and Dubai Financial Market lost 9.4 percent as 12 stocks declined by more than 5 percent.

"Emaar, Arabtec and DFM have been the most volatile and the most active stocks - they were the ones speculators are playing with and so were expected to see the most selling pressure," said Ayman el-Saheb, Darahem Financial Brokerage director of operations. "There's no good news in the market."

The index fell 4.3 percent to 1,582 points, its lowest finish and largest decline since December 9. Volumes also increased by more than a quarter from the Thursday, indicating rising selling pressure.

"The buyers before were only speculators, it wasn't coming from institutions," added Saheb.

"So with what happened internationally and the lack of local liquidity, there was no way for the market to move but down."

Abu Dhabi's index fell for a fourth session running, slumping to a six-week low as property stocks slid, tracking losses on Dubai's benchmark.

UAE investors needed little reason to sell following Dubai World's November debt standstill request, and with global markets tumbling on US President Barack Obama's plan to rein in US banks, the emirates' equities have been hammered on Sunday.

Aldar Properties fell 7 percent, RAK Properties dropped 5.7 percent and Sorouh Real Estate slid 6.6 percent.

The index fell 1.4 percent to 2,600 points, its lowest finish since December 10.

Al-Rajhi Bank, Saudi Arabia's largest listed lender, was the main support as the kingdom's index ended slightly higher, bucking a regional downward trend as quarterly earnings bolstered sentiment.

Al-Rajhi climbed 1 percent and Saudi Electricity Co rose 0.8 percent, while SABB and Riyad Bank each added 0.7 percent.

SABIC ended flat at 88.75 riyals, not far from Wednesday's 15-month high. On Tuesday, the petrochemicals producer reported a 15-fold rise in fourth-quarter profit, beating analysts' forecasts.

The index edged up 0.1 percent to 6,302 points.

Qatar's index slumped to an eight-week low as investors dumped Middle East stocks following an end-of-week sell off in global equities.

Industries Qatar fell 1.9 percent, Qatar Gas Transport Co (Nakilat) dropped 1.8 percent and Doha Bank slid 2.3 percent.

The index fell 1.6 percent to 6,666 points, its lowest finish since December 1 and third straight decline. Losers outnumbered gainers 17 to two.

Bahrain's measure also retreated, slipping 0.4 percent to 1,471 points.

Zain slumped to a 10-week closing low as its Saudi affiliate said it was in creditor talks after missing commitments on a $2.5-billion Islamic loan, dragging Kuwait's index to its first decline in four sessions.

Zain fell 3.1 percent to 0.95 dinars, its lowest finish since November 18, with fears over its likely fourth-quarter earnings also weighing on the stock.

"Zain is expected to report bad results, which increases negative sentiment," said Shahid Hameed, head of asset mangement at Global Investment House.

National Bank of Kuwait fell 1.8 percent and Kuwait Finance House dropped 1.9 percent as seven of the 10 largest stocks declined, with only one rising.

The benchmark fell 0.5 percent to 7,025 points.

Oman's index ended lower for a third session running, slipping to its lowest close of 2010 as investors dumped Dubai-related stocks in the wake of a sharp sell-off on the emirate's index.

Selling was mostly directed at small cap names such as Al Anwar Holding and Oman & Emirates Investment Holding Co, which fell 6.4 and 6.1 percent respectively. They have significant investments in Dubai and so with the emirate's index plunging to new six-week lows, investors were offloading the pair.

The index fell 0.6 percent to 6,368 points, its lowest close since December 30.

Bank Muscat slid 1.1 percent and Galfar Engineering dropped 4.5 percent.

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