Dubai Stock Index Leads Persian Gulf Rout on China Concern

Dubai’s benchmark stock index tumbled the most in more than six months, leading declines in the Persian Gulf, before data tomorrow that may add to signs China’s economy is faltering.

The DFM General Index retreated 3.8 percent, the most since Aug. 27, to 3,935.79 at the close in Dubai. The measure, which has more than doubled in the past 12 months, fell below the 4,000-level for the first time in four weeks. It was the worst performing index globally among more than 90 tracked by Bloomberg, followed by Abu Dhabi’s gauge, which slumped 2.8 percent. Qatar’s index lost 1.4 percent.

China, the world’s second-biggest economy, will release industrial production data tomorrow after reports over the weekend showed the steepest slide in exports since 2009, highlighting the challenges for Premier Li Keqiang in achieving this year’s economic growth target. The Hang Seng China Enterprises Index sank to an eight-month low, while the MSCI Emerging Markets Index fell 1.2 percent.

“Bad news from China has created a fear in the markets globally, not only here,” Samer Mardini, a vice president of Fixed Income at SJS in Dubai, said by phone. Investors fear another financial crisis, which could be “sparked in China,” and that is affecting those emerging markets that “rose too much.”

Dubai’s index has still rallied 17 percent this year, making it one of the top 10 performers globally. Abu Dhabi’s gauge has gained 8.4 percent and Qatar’s 9.3 percent.

Emaar Properties PJSC, the company with the highest weighting on Dubai’s index, declined 3.5 percent, the biggest slide since Jan. 7, to 8.57 dirhams. Dubai Islamic Bank PJSC, the largest Islamic lender in the United Arab Emirates, lost 3.6 percent to 5.70 dirhams. Deyaar Development PJSC was the biggest decliner, retreating 9.6 percent to 1.13 dirhams.

Bahrain’s gauge declined 0.9 percent and Kuwait’s slipped 0.2 percent. Oman’s gauge fell 0.1 percent. Saudi Arabia’s Tadawul All Share Index dipped 0.2 percent at 2:56 p.m. in Riyadh.

Before it's here, it's on the Bloomberg Terminal.