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Sun 21 Dec 2008 10:30 AM

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Gulf markets slump on oil price fears

UPDATE 4: The majority of markets fall, with Dubai, Abu Dhabi and Kuwait leading drop.

The majority of Gulf markets fell on Sunday after Saudi Arabia's bourse tumbled more than 4 percent in the previous session and oil prices failed to steady following OPEC's proposed output cut last week.

Property and banking shares helped drag UAE stock markets to close sharply lower.

In Dubai, Emaar Properties fell 9.93 percent and Dubai Islamic Bank dropped 9.83 percent as the index closed 5.58 percent lower at 1,802 points.

Abu Dhabi's bourse fell 3.72 percent to 2,576 points, led by telecom Etisalat and First Gulf Bank, which declined 4.94 percent and 9.04 percent respectively.

Aldar Properties fell 9.94 percent and Sorouh Real Estate 9.82 percent.

Kuwaiti telecom Zain ended 8.77 percent lower and Global Investment House dove 8.2 percent as the benchmark slid 2.66 percent.

Global, which was downgraded by two ratings agencies last week for allegedly failing to meet debt obligations, was expected to meet with foreign lenders to renegotiate the terms of it debt.

"The concentration of investment companies that are struggling to meet their obligations is dictating the direction of the market," said Rami Sidani, head of MENA investments at Schroders Investment Management.

The index finished at 8,394 points.

Saudi Arabia and Qatar bucked the downward trend.

Saudi Arabia's benchmark closed higher led by Samba Financial, which advanced 3.6 percent and Saudi Basic Industries Corp. (SABIC), which climbed 1.82 percent. The benchmark ended up 1.46 percent at 4,774 points. Industries Qatar climbed 3.52 percent and Qatar Commercial Bank 1.87 percent as the country's index closed up 0.34 percent at 6,665 points.

Oman Cable Industries and Oman Oil dropped 10 percent and 5.91 percent respectively leading Muscat's benchmark lower after two trading days of higher closes.

Muscat's index ended 2.29 percent lower at 5,942 points.

Bahrain's measure fell 2.14 percent to 1,861 points.

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