Global stocks dipped and crude oil fell on Monday after euro zone finance ministers delayed a decision on extending emergency loans to Greece.
“The market is following weakness in global markets in the midst of Greece, problems in Japan, rising rates in China and weak economic numbers from US,” said a Riyadh-based fund manager who asked not to be identified. “Weakness in oil prices will also influence petrochemical sector sentiment.”
“Investors are noncommittal about whether stocks have become cheap enough after recent weakness to pour some money back into equities again. They are very cautious and reactive,” the fund manager added.
UAE banks tumbled after Goldman Sachs downgraded three lender and cut price targets on Monday to account for negative impact from tighter consumer finance regulation, and most other Middle East markets also fell.
Goldman downgraded Abu Dhabi Commercial Bank to “sell” from “buy,” Dubai Islamic Bank to “sell” from “neutral,” and Emirates NBD Bank to “neutral” from “buy.” Emirates NBD slumped 6.4 percent, Dubai Islamic fell 1.4 percent and ADCB dropped 2.7 percent.
Dubai’s index falls 1.7 percent, its largest one-day fall since March 23.
Emaar Properties lost 2.2 percent and Dubai Financial Market ended 4.6 percent lower.
Abu Dhabi’s index slipped 0.7 percent, easing from Sunday’s 23-week high.
Aldar Properties dropped 2.1 percent.
In Qatar, Barwa Real Estate gave back some of Sunday’s gains that were sparked by a newspaper report that the developer had leased its Barwa City Project to Qatar Airways for 7.1 billion riyals ($1.95 billion).
Negotiations continue, but no deal has been signed yet, a source familiar with the matter told Reuters in Doha.
Barwa dropped 1.1 percent. It had risen 3 percent on Sunday.
The benchmark fell 1.4 percent, down 1.9 percent in June as all 20 stocks declined.
Industries Qatar and Commercial Bank of Qatar each dropped 2.6 percent, while Qatar National Bank slipped 2.1 percent.
Egypt’s main index closed 0.8 percent lower after reversing an early gain that took it to its highest since a popular uprising toppled President Hosni Mubarak, with traders saying the benchmark had reached a key resistance level.
They said some foreign investors wary of the effect of Egypt’s economic crisis on upcoming second-quarter results also decided to sell later in the session, taking profits from a market that has gained 18 percent from a low on March 24.
The index closed at 5,581 points after touching 5,666.55 points, its highest since Jan. 27 when the anti-Mubarak uprising was gathering pace. It is still down 21 percent this year.
Kuwait’s index lost 1 percent, its largest one-day drop since March 16.
Worries about switching to a new trading platform were weighing on the market, traders said.
