Gulf stock markets head lower on euro debt worries, weak oil prices

08:37, June 07, 2010      

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Stock markets in Gulf Arab countries headed lower Sunday due to weak oil prices and ongoing debt worries in the euro zone, with the euro touching a four-year-low against the U.S. dollar. After Greece, Spain and Portugal, the Central European country Hungary becomes the latest candidate with severe debt problems, and in danger of defaulting.

Saudi Arabia's Tadawul market in Riyadh ended unchanged at 5, 924.59 points. Bellwether Saudi Basic Industries Corporation declined by 1.50 percent, closing at 82.00 Saudi riyal (21.32 dollars) as oil prices retreated to 70 dollars per barrel.

Non-oil exports by Saudi Arabia showed a year-on-year increase of 21 percent in March to reach 11.4 billion Saudi riyal (3.1 billion dollars), while imports rose by a mere 1 percent in the same period to reach 29.9 billion Saudi riyal (8 billion dollars), according to investment bank Jordinvest.

In Dubai, the local stock market DFM finished at the start of the new trading week at 1,513.40 points, down 1.84 percent. Disinflation is continuing in Dubai, as in April the inflation declined to 0.6 percent compared to 4.6 percent in April 2009. Lower telecommunication prices were the main reason, Jordinvest said.

The DFM is the only Arab stock market whose shares are listed publicly. DFM shares lost 2.53 percent, closing at 1.53 dirham (0. 41 dollar). During the last three months, however, the DFM outperformed most other listed shares, gaining 13.48 percent.

The price-earnings ratio of the DFM is valued at 35.54, making the stock relatively expensive. Foreign investors continued to sell their positions at the DFM, investment bank EFG Hermes in Dubai said.

Meanwhile, the DFSA, the financial regulator of Dubai's onshore banking hub Dubai International Financial Center, approved a merger between the DFM and the international exchange Nasdaq Dubai "in principle."

The Abu Dhabi Securities Exchange General Index weakened 1.29 percent and stood at 2,537.92 points at the close of trading. Stocks of real estate giants Aldar Properties and Sorouh pulled the index down, off 2.84 percent and 2.38 percent respectively at 2.06 dirhams (0.56 dollar) and 3.09 dirhams (0.84 dollar).

In Kuwait, the KSE Market Index closed 0.37 percent lower at 6, 708.6 points in line with the general bearish mood in Gulf Arab nations. Commercial Bank of Kuwait won against the trend, gaining 3.27 percent at 0.92 Kuwaiti dinar (3.12 dollars).

Although gaining points during the second half of the trading session, the Qatar Exchange (QE) failed to gain territory. The QE Market Index closed 0.44 percent lower at 6,773.47 points. Doha Insurance hit the bottom of the charts by losing 3.20 percent and closing at 27.00 Qatari riyal (7.29 dollars).

Source:Xinhua

(Editor:黄蓓蓓)

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