JEDDAH/DUBAI: Property and banking stocks led a broad decline in the Gulf Arab region on Wednesday, with Dubai suffering its biggest daily loss in two weeks, as uncertainty over its debt continued to weigh on investor sentiment.
Dubai’s benchmark fell 3.8 percent to 1,736 points.
“Still people are feeling uncertain about real estate in Dubai and everybody is revising the numbers,” says Chamel Fahmy, Beltone Financial regional senior sales trader. “In Dubai, no one can paint a clear picture of where things are heading. Dubai is still trying to figure out what to do,” said a Kuwait-based trader, referring to debt concerns.
Traders said no particular catalyst sparked the selloff, although one analyst referred to a newspaper report saying that Deyaar and Union Properties, two Dubai-based property firms, called off merger plans, as the new entity would struggle to secure financing.
After market close, Deyaar issued a statement saying it was not involved in any talks and wanted to explore growth opportunities in the United Arab Emirates and other regions.
Abu Dhabi’s index also posted a decline, falling 1.9 percent to 2,694 points, with Abu Dhabi Commercial Bank closing 6.1 percent lower.
In Kuwait, logistics firm Agility extended its losses from the previous days, ending 7.3 percent lower. The stock has declined nearly 20 percent since it said on Dec. 21 that US defense contractor DynCorp International had dropped its US unit as a subcontractor in a US Army deal.
Qatar’s index fell 0.6 percent to 7,029 points, with banks stocks posting some of the biggest declines. Qatar Islamic Bank fell 0.3 percent, outperforming some of its peers, after Italian insurer Generali said may launch a Takaful joint venture.
Saudi stocks edged 0.2 percent higher to 6,244 points, led by petrochemical stocks, the only Gulf Arab market to post gains amid the regional selloff. Sector breadth was also positive, with only 6 of the 15 sectors closing with losses, which ranged from 0.14 percent in the real estate development sector to a loss of 0.70 percent in the Hotel & Tourism sector. Overall market breadth was also positive, with 61 advancers and 45 decliners, recording an AD ratio of 1.36, the Jeddah-based Financial Transaction House (FTH) said on Wednesday in its daily market commentary.
— With input from agencies