Dubai market retreats; Gulf stocks drop further

Dubai: Gulf shares declined and Dubai's benchmark index retreated for a seventh day on concern a drop in property prices may extend into next year, worsening an economic slump.

Emaar Properties PJSC's, the region's biggest publicly traded real-estate developer, fell 1.3 per cent to 2.22 dirhams, extending this week's loss to 16 per cent. Dubai Islamic Bank PJSC, the United Arab Emirates' biggest lender complying with Muslim banking rules sank to its lowest level since November 2003, while National Bank of Kuwait, the emirate's biggest lender tumbled 7 per cent.

The Dubai Financial Market General Index dropped 1.7 per cent to 1,583.95 at 10:16 a.m. local time, extending this week's slide to 12.1 per cent. The measure is down 73 per cent this year. Abu Dhabi's gauge retreated for a sixth day, declining 1.5 per cent. The Kuwait Stock Exchange Index weakened 1.4 per cent.

“There are rumors that the downturn in the real estate sector will extend to 2009, and we can see 30 percent to 35 percent decline in prices,'' said Chamel Fahmy, senior regional sales trader at Beltone Securities Brokerage in Dubai. “This is causing a lot of selling pressure.''

Emaar dropped to 2.22 dirhams. Dubai Islamic Bank fell 6.1 per cent to 1.55 dirhams. The stock is down 14.3 per cent in the last two days as Standard & Poor's cut the lender's rating to “negative'' from “stable'' on Nov. 23.

National Bank of Kuwait declined to 1,280 fils.

Oman's Muscat Securities Market 30 Index lost 1.7 per cent, and Qatar's DSM 20 Index dropped 0.5 per cent. Bahrain's market rose 0.2 per cent. Saudi Arabia's Tadawul is closed for the weekly holiday.

Have you invested a lot in the stock market? How has this recent decline affected you? How long do you think it will continue?