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Dubai: Gulf shares declined as the Group of Seven (G7) finance chiefs failed to announce specific steps to restore investor confidence and as crude oil closed at a September 2007 low in New York.
Emaar Properties PJSC, the Middle East's largest real- estate developer, slumped the most in almost a week after Citigroup Inc. cut its share-price estimate. Emirates Telecommunications Corp. retreated to the lowest in more than a year and National Bank of Kuwait also dropped.
The Dubai Financial Market General Index tumbled 5 per cent to 3.037.65 at 10:41am local time, bringing the decline for the year to 49 per cent. The Abu Dhabi Securities Exchange General Index retreated 4.4 per cent and the Kuwait Stock Exchange Index fell 2.4 per cent. Oman's Muscat Securities Market 30 Index declined 4.4 per cent.
“Investors want to know how the G-7 countries will execute their strategy to restore investor confidence, that's not clear from their message over the weekend, creating anxiety among investors,'' Faisal Hasan, head of research at Global Investment House KSCC, said in a telephone interview on Sunday from Kuwait. “Oil is trading below $80, which is a source of concern for the region, especially at a time when the liquidity is drying up.''
Group of Seven finance chiefs, meeting after stocks plunged and as a global recession looms, vowed to prevent the collapse of major banks while failing to unveil new initiatives for thawing credit markets. They refrained from specific fresh measures such as embracing a UK plan to guarantee loans between banks.
Crude oil fell below $78 on concern that the deepening financial crisis will push the global economy into a recession. Oil for November delivery fell $8.89, or 10 percent, to $77.70 a barrel at the New York Mercantile Exchange on Oct. 10.
The Dubai Financial Market has capped daily stock moves to 10 per cent on Sunday, according to an official at the emirate's bourse who declined to be identified.
Emaar lost 8.8 per cent to 5.2 dirhams. Citigroup cut the share-price estimate 29 per cent to 15 dirhams and maintained its “buy” recommendation for the stock.
Emirates Telecommunications, the largest phone company in the United Arab Emirates, dropped 3.3 per cent to 13.3 dirhams, the lowest since April 2007. National Bank of Kuwait, the Gulf state's biggest lender by market value, lost 2.2 per cent to 1,780 fils.
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