Black Wednesday for UAE markets

Dubai: The UAE stock markets along with other Gulf markets suffered another day of heavy losses as investors went on a panic selling spree not able to make sense of where it will all end amid the massive sell-offs all around the world on Tuesday and in Asian markets on Wednesday.

"This is not a Black Wednesday, this is charcoal boiled Wednesday," said Vyas Jayabhanu, head of Al Dhafra Brokerage in Abu Dhabi. "It's all a chain reaction and it's clear that what happens in America deeply affects the rest of the world. It is indeed serious and looks like a great depression is likely to revisit us."

Locally, stocks across the board were brunt but real estate and bank and finance companies continue to suffer the most. The credit squeeze among the banks is likely to worsen, feel analysts as inter-banking lending rates in Saudi Arabia and UAE were raised again on Wednesday.

"Domestic insitutions and companies have started to sell-off and that is a scary sign," Jayabhanu said. "There are large sell orders from the local institutions."

The Dubai Financial Market General Index plunged 284 points or 8.43 per cent to close at 3085.02. Major losers included Arabtec, which tumbled 15.00 per cent, Air Arabia shed 9.24 per cent, Emaar fell 7.41 per cent, Union Properties plummeted 12.83 per cent and mortgage giants Amlak Finance and Tamwell lost 14.17 per cent and 13.83 per cent.

The Abu Dhabi Securities Exchange Index retreated 6.43 per cent to end at 3176.94. Real estate, energy and banking sectors indices fell 9.62 per cent, 9.34 per cent and 6.29 per cent respectively. Aldar Properties lost 9.70 per cent, Sorouh slid 9.75 per cent, Dana Gas was down 8.70 per cent and Abu Dhabi Commercial Bank fell 9.72 per cent.