Dubai:

A downward spiral in crude oil prices continued to dent investor sentiment in GCC equity markets on Sunday. The Dubai index wiped off gains registered in 2014, since it fell another 7 per cent for a second straight session.

The Dubai Financial Market General Index ended 7.61 per cent at 3,321.33, after hitting a low of 3,312.48, a level last seen in January. Leading the decline were construction major Arabtec and Emaar Properties. Arabtec fell 9.66 per cent, while Emaar Properties fell more than 8 per cent.

Dubai’s stock market was the world’s best performing this year until it was caught up in a regional sell off amid tumbling oil prices.

“The oil price fluctuation has killed our markets. Market participants are expecting a rebound to happen, but no one knows when? How low we will go before any technical rebound is a question that everyone is asking,” Sebastien Henin, head of asset management at The National Investor.

Market analysts feel that the performance of UAE equity markets will be linked to crude oil going forward.

Brent crude slumped 2.9 percent to $61.85 a barrel in London on Dec. 12, for the lowest close since July 2009. Brent has tumbled 20 percent since Nov. 26, the day before OPEC decided to maintain production.

“Investors are overreacting. They are all panicking as the bottom for oil prices is not clear,” said Tariq Qaqish, Head of asset management, Al Mal Capital.

The Abu Dhabi Securities Exchange General index ended 3.63 per cent lower at 4,209.75.

Elsewhere, Qatar Exchange Index ended 5.85 per cent lower at 11,114.43, while Tadawul All Share TASI index ended down 3.27 per cent at 8,119.08. The Muscat Securities MSM 30 Index closed 3.17 per cent down. Kuwait Stock Exchange fell more than 2.92 per cent.

On Friday, stock indices from the United States to Europe fell due to a sell off in crude oil, with more than than $1 trillion getting erased from the value of global equities last week.

The Dow Jones Industrial Average had its worst week since 2011 and European shares fell the most in more than three years.