The continued closure of the Egyptian bourse added to the ambiguity of the situation with investors predicting Egyptian stocks to dive when the stock market re-opens, sending a series of negative repercussions across regional markets, they added.

“The sharp decline in the Saudi and other Gulf markets is illogical and unjustifiable,” Nizar Taher, head of brokerage at the Jordan Ahli Bank, told Arab News.

“The plummeting of the Gulf bourses has been prompted by fears that uprisings could spread to the area, but I don’t think so because protests there are looked at as sectarian moves which are inspired by Iran,” Taher said referring to the recent demonstrations in Bahrain, Oman and Yemen.

He expected last week’s plunges at the Gulf markets to be short-lived because regional governments would use accumulated surpluses to reinvigorate markets through various tools of public spending.

“Surging oil prices will in the long term help to prop up regional markets,” Taher said.

Saudi shares led the plunge with the Tadawul All Share Index (TASI) of the Arab world’s largest stock exchange diving by about 15 percent on weekly basis, to close at a two-year low of 5,323.27 points.

On a week to date basis, TASI made a consolidated lose of -15.02 percent. The liquidity for the week came in at SR20.10 billion as compared to SR17.46 billion for the past week.

The sector activity was all negative. The losing sectors ranged from -9.07percent by the cement sector to -22.37 percent by the insurance sector.

The top losers for the week were the Gulf General Cooperative Insurance Co. with a loss of -29.14 percent to close at SR32.60 and the Solidarity Saudi Takaful Co. losing -11.35 percent to close at SR29.07, the Financial Transaction House (FTH) — licensed by the Capital Market Authority (CMA) — said in its weekly market report.

“The political developments in the region are apparently putting down pressure on the Saudi market, but the absence of incentives and confidence-boosting measures has aggravated the decline,” said Saudi analyst Khalid Jawher, an executive at the Jawher Investment group.

He said that the plunge could not be justified, given the high oil prices, the macroeconomic scene and the positive performance of listed firms.

Jawher suggested that steps should be taken by the country’s sovereign funds to prop up prices and restore confidence to investors.

Kuwait’s KSE all-share index also fell by 5.1 percent last week, closing at 6,147 points.

In addition to geopolitical factors, Kuwaiti stocks also came under additional pressure from news about the failure of a multi-billion-dollar dollar deal involving the sale of a 46 percent stake in Kuwait’s Zain mobile group to the United Arab Emirates telecommunications firm, Etisalat.

The benchmarks of the UAE stock exchanges of Dubai and Abu Dhabi also shed 8.5 percent and 3.2 percent this week, to close respectively at 1,352 points and 2,529 points.

The Qatar stock exchange also sank 8.7 percent, to close at 7,489 points.

The all-share index of the Bahrain and Muscat bourses lost 3.8 percent and 4.4 percent, closing week respectively at 1,377 points and 6,352 points.

The benchmark of the Amman Stock Exchange fell 1.8 percent last week, to close at 2,214 points.