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Mon 21 Feb 2011 11:04 AM

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Dubai shares decline to 6-month low as ME unrest spreads

Emaar retreated 1.3 percent to AED2.98, the lowest since March 2010

Dubai shares decline to 6-month low as ME unrest spreads
STOCK WATCH: Dubai’s stocks dropped to the lowest level in almost six months (Getty Images)

Dubai’s stocks dropped to the
lowest level in almost six months, leading a decline in the Middle
East, as unrest in the region escalated with demonstrations in Libya,
Bahrain, Yemen and Morocco.

Dubai Islamic
Bank, the UAE's biggest Shariah-compliant lender,
declined 1.8 percent and Emaar Properties, builder of the world’s
tallest skyscraper, tumbled to the lowest in almost a year.

Dubai’s DFM
General Index lost 1.3 percent to 1,516.43, the lowest since September 2,
at the 2 pm close in Dubai.

Abu Dhabi’s ADX General Index retreated
0.5 percent and Oman’s MSM30 Index fell 0.9 percent.

“Foreign
investors are exiting the region as risk increases,” said Ziad Dabbas,
a financial analyst at National Bank of Abu Dhabi , the UAE’s
second-largest lender by assets. “They are turning to markets with more
political stability as the region faces this transitional period, from
both a political and security perspective.”

Libya, holder
of the largest crude oil reserves on the African continent, has become
the focal point of region-wide protests ignited by the ouster of
Tunisia’s president last month and energised by the fall of Egypt’s
president on February 11. The Bloomberg GCC 200 Index has lost 4.9 percent
since Hosni Mubarak stepped down.

In Bahrain,
thousands of protesters yesterday poured back into the central square
after tanks, armored personnel carriers and riot police withdrew on the
orders of the crown prince. In response unions called off a general
strike planned for on Monday.

Demonstrations
also were reported yesterday in Iran and Morocco and analysts warned of
the risk of unrest spreading to Saudi Arabia, the world’s biggest oil
exporter. Oil for April delivery rose for a fourth day in New York as
violence escalated in Libya, bolstering concern supplies will be
disrupted by turmoil in the region.

Crude rose as
much as 4.2 percent to $93.50 a barrel in electronic trading on the New
York Mercantile Exchange. The six nations of the Gulf Cooperation
Council, including Qatar and Saudi Arabia, supply about a fifth of the
world’s oil.

Dubai Islamic
fell to AED2.21, the lowest since February 1. Emaar retreated 1.3
percent to AED2.98, the lowest since March 2010.

The Tadawul All Share Index in Saudi Arabia, which neighbours Bahrain, also a scene of anti-government protests, lost 0.6 percent. Bahrain’s gauge declined 0.4 percent. Qatar’s
QE Index lost 0.9 percent, while Kuwait’s measure rose 0.5 percent.

 

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Al Shamal 9 years ago

Can you remember when movements in the oil price were mirrored in Gulf equity markets ? Political risk has thrown a massive spanner in the works.