UAE stocks take further beating

Dubai: With a segment of the foreign funds continuing to sell off and forcing some retail investors to come in and sell, battering continues on both UAE stock markets.

The Dubai bourse closed lower for the seventh straight session and Abu Dhabi for the eighth.

"Some of the hedge funds that came in since the beginning of the year are being forced to de-leverage as a result of the global banking crisis which continues to still unfold, and as a by-product of that they are putting in their sell orders at a time when unfortunately we have gone into summer, the retail has totally out of the market and this has been an exceptionally slow season because it happens to coincide back to back with Ramadan," said Haissam Arabi, managing director of asset management at Shuaa Capital.

After a relatively light fall of one per cent the day before, the Dubai Financial Market General Index shed 1.98 per cent yesterday to close at 4,943.89.

The index has shed 8.93 per cent since August 4, the day the current decline commenced.

The Abu Dhabi benchmark shed 1.82 per cent to end at 4,392.55. It has retreated 12.33 per cent since August 3. In Dubai, real estate stocks were badly hit. Emaar Properties dropped to its lowest level since April 2005, shedding 3.03 per cent to Dh9.60.

"First of all, Emaar has only now gone down," said Arabi.

"Basically, there was a little bit of panic selling. Some of the retailers had held on to Emaar and other stocks but with the first couple of sell-offs, in a snowball effect the retailers came in and sold off and that is why Emaar went down."

In Dubai, losers trumped gainers 23 to two, Dubai Financial Market being one of the two.

In Abu Dhabi, 7 stocks advanced, 28 declined and five remained unchanged with banks leading the decline.