By Zahra Hankir on May 13, 2012
Dubai stocks led a drop in the Persian Gulf, set for the lowest close in three months, after oil slumped on concern that Europe’s debt crisis will worsen and as China’s industrial growth unexpectedly slowed in April.
Arabtec Holding Co. (ARTC), the biggest builder in the United Arab Emirates by market value, fell 1.7 percent. Emaar Properties PJSC (EMAAR), developer of the world’s tallest skyscraper, retreated for the eighth time in nine days. Dubai’s DFM General Index (DFMGI) decreased 0.9 percent to 1,501.15, set for the lowest close since Feb. 12, at 10:43 a.m. in the emirate. The Bloomberg GCC 200 Index (BGCC200) slipped 0.1 percent.
“Investors have shifted their focus from corporate earnings to other issues such as oil prices falling quickly and sharply to the lows of the year and the turmoil in the euro zone,” said Nabil Farhat, a partner at Abu Dhabi-based Al Fajer Securities. “These are all factors that might impact the current and future liquidity inflows and outflows from the U.A.E.”
Crude for June delivery fell 2.4 percent last week to $96.13 a barrel on the New York Mercantile Exchange, a 2012 low, after Chinese factory output rose 9.3 percent in April from a year earlier, missing estimates. Gulf Arab oil exporters, including Saudi Arabia and the U.A.E. supply about a fifth of the world’s oil. About 11 million shares traded in Dubai so far today, compared with a peak this year of 835 million. Abu Dhabi’s benchmark index lost 0.2 percent.
U.S. Stocks Fall
Global equities declined last week as an inconclusive election in Greece left political parties struggling to form a government. The impasse reignited concern over Greece’s ability to meet terms of its two bailouts and the possibility the country will leave the euro. U.S. stocks also tumbled, with the Standard & Poor’s 500 Index (SPX) slumping 1.2 percent in its second weekly retreat after U.S. banks sank following JPMorgan Chase & Co. (JPM) ( JPM )’s $2 billion trading loss.
Arabtec dropped to 2.9 dirhams, headed for the lowest close since April 2. Aabar Investments PJSC and its units have acquired a 53 percent stake in Arabtec, Alrroya reported. Abu Dhabi government-controlled Aabar directly owns 23 percent of Arabtec and affiliates have 30 percent, the newspaper said citing Aabar Chairman Khadem Al Qubaisi. Aabar declined to comment when contacted by Bloomberg news. Officials at Arabtec were not immediately available for comment.
Emaar declined 1.3 percent to 2.94 dirhams.
Qatar’s QE Index (DSM) retreated 0.3 percent while Kuwait’s gauge fell 0.2 percent. Oman’s benchmark stock index slipped 0.1 percent while Bahrain’s measure little changed.
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