Dubai’s Shares Decline Before Europe Crisis Meeting; Dubai Financial Drops
Dubai’s shares declined for the third day this week ahead of a meeting of European leaders to discuss how to contain the region’s sovereign debt crisis.
Dubai Financial Market PJSC (DFM), the only Persian Gulf bourse to sell shares to the public, fell to the lowest level since Nov. 28. Air Arabia PJSC, the Middle East’s biggest discount airline, lost the most since Nov. 20. The benchmark DFM General Index (DFMGI) retreated 0.1 percent to 1,384.37 at the 2 p.m. close in the emirate, trimming this week’s gain to 0.4 percent. About 40 million shares traded in Dubai today compared with a 12-month daily average of 100 million, according to data compiled by Bloomberg.
European leaders will meet at a summit in Brussels today and tomorrow to discuss efforts to halt the credit crisis amid warnings from Standard & Poor’s that it may lower the credit ratings of 15 euro-area nations, including Germany, Europe’s largest economy. The MSCI Emerging Markets Index (MXEF) declined 0.5 percent at 3:39 p.m. in Dubai and the Stoxx Europe 600 Index was little changed after declining in the previous two days.
“All eyes are on what’s going to happen in the summit,” said Haissam Arabi, Dubai-based chief executive officer at Gulfmena Investments. “We are in a standstill, wait-and-see mode.”
Dubai’s government yesterday denied a report that it plans to restructure debt of state-owned companies next year and said it was ready to support them through “various options.”
The government statement was “priced in,” Arabi said, after the Dubai Holding Commercial Operations Group LLC annoucement the previous day. The real-estate and hospitality company owned by Dubai’s ruler said it will repay a $500 million bond from its cash flow when the notes mature in February 2012. Dubai’s measure gained 0.2 percent yesterday.
Dubai Financial Market slipped 0.5 percent to 94.5 fils. Air Arabia dropped 1.1 percent to 61.3 fills. There are 100 fils to the dirham.
Abu Dhabi’s ADX General Index (ADSMI) declined less than 0.1 percent and Kuwait’s measure gained less than 0.1 percent. Qatar’s QE Index (DSM) and Oman’s MSM30 Index rose 0.3 percent. Bahrain’s BB All Share Index and the Bloomberg GCC 200 Index were little changed. Saudi Arabia’s stock market was closed for the weekend.
To contact the reporter on this story: Alaa Shahine in Dubai at firstname.lastname@example.org
To contact the editor responsible for this story: Claudia Maedler at email@example.com