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Sun 5 Oct 2008 11:09 AM

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Emaar, Mazaya lead declines in UAE markets

UPDATE 1: Real estate firms see their shares struggle on first day back after Eid holiday.

Emaar, Mazaya lead declines in UAE markets
EARLY FALL: Emaar Properties was among high-profile declines across UAE markets on Sunday. (Getty Images)

Markets in the Gulf were depressed on Sunday as investorsreturned from a five-day holiday across the Gulf Arab region following a global selloff across US, European and Asian markets last week.Real estate companies led the declines with Emaar Properties (11 percent) and Mazaya (14 percent) among the high-profile losers in Dubai - with the index down by more than seven percent at just before 1pm (Dubai time). In Abu Dhabi, Sorouh was down by 10 percent as the exchange fell by more than three percent.

"The $700 billion move has resolved the issue only for the short term and for the US; it has done nothing for the rest of the world," said Mohamed Yasin, managing director of Shuaa Securities.

"The problem we're facing today is not an equity problem but a liquidity problem across the banking system around the world and the Gulf Arab region is part of that ... the money pumped into the system is not enough."

News of a proposed merger between Islamic mortgage lenders Tamweel and Amlak Finance also did little to boost confidence as investors await more clarity on the move.

"One view is the merger (talks) between Tamweel and Amlak is negative becuase it is not clear why they are doing it now, especially when we have mortgage problems globally and there is a liquidity problem in the UAE and banking sector," said Sherif Abdelkhalek, institutions accounts manager at Beltone Financial.

Kuwait's exchange was also down by nearly three and a half percent, Qatar by more than six percent and Oman by more than two and a half percent.

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