Global fears shatter stocks

Dubai: UAE markets fell sharply on Thursday with investors worried about the continuing weakness in the global markets and a recession likely to impact the region.

Local concerns about real estate growth slowing down and affecting other sectors including banking, mortgage and construction persist, affecting all the listed companies in each sector.

And last but not least, the bearish hangover seems still to be overwhelming in a market where healthy fundamentals just do not count. After enjoying a modest rally in the week preceding the presidential elections, the US market on Wednesday ended down more than 5 per cent.

With poor corporate results coming out and investors nervous of what looks like an inevitable slowdown, Asian markets fell yesterday, with all three indices - Nikkei 225, Hang Seng and Kospi - declining more than 6.5 per cent and wiping all the gains during the past week. European markets were down too around midday - France's CAC40 index 3.69 per cent, London's FTSE 100 3.10 per cent and Germany's DAX 4.15 per cent.

The Dubai Financial Market tumbled 4.10 per cent to close at 2,797.60 with bellwether Emaar Properties falling below Dh5 to its lowest level in almost four years. It closed at Dh4.93, losing 6.98 per cent. The Dubai benchmark lost 5.4 per cent over the week and has shed 52.8 per cent on the year.

The Abu Dhabi Securities Exchange Index slid 3.31 per cent to end at 3,321.79.

"We are [so] correlated with the world markets and more so with the US that we will be susceptible to any swings in those markets," Haissam Arabi, managing director, asset management, Shuaa Capital, said.

"Also, there is a severe bearish sentiment and people don't know where the bottom is, a reason for not seeing a bounce in the markets here when other global markets saw some recovery before the US elections."