Stock markets in the Gulf states fell sharply this week as the impact of the global economic crisis and the slide in oil prices took a further toll on the region. The two United Arab Emirates markets and the Omani bourse led the slide while the markets of Saudi Arabia and Kuwait, the biggest and second largest bourses in the Arab world, respectively, also slumped. The Saudi Tadawul All-Shares Index ended the week on Wednesday down 4.8 per cent at 4,669.05 points after the Opec kingpin projected a budget deficit next year for the first time since 2002.
Although the 2009 budget is the biggest in the kingdom's history, the projected expenditure is still about seven per cent down on actual spending this year. Actual spending normally ends up higher than the budget. The TASI is down a massive 57.7 per cent on the year. In the UAE, the Dubai Financial Market witnessed its worst weekly performance in over a month, diving 16.9 per cent to close at 1,587.08 points, its lowest level in well over four years.
The DFM Index has so far lost 73.2 per cent this year, pulled down mainly by the leading real estate sector which has been undergoing a strong correction due to a credit crunch that has hit the booming emirate of Dubai. Market leader, property developer giant Emaar has lost more than 85 per cent since the start of the year. Its sister market, the Abu Dhabi Securities Exchange sank 14.7 per cent to close the week at 2,281.59 points, a four-year low, under pressure from most sectors, mainly the real estate, energy and banking. It is down 50 per cent on the year.
The Kuwait Stock Exchange ended the week down 4.5 per cent at 8,240.70 points, close to its lowest level since May 2005. The decline came despite the launch of a multi-billion dollar special government fund which began buying stocks on the market on Wednesday. Political squabbles and a dispute between MPs and the government over a US$7.5 billion (Dh27.5bn) deal with the US firm Dow Chemical, have strongly impacted investor sentiment.
The KSE Index is down 34 per cent on the year and is a massive 47 per cent lower than its all-time record reached at the end of June this year. The small Muscat Securities Market was the biggest loser this week, diving 17.8 per cent to drop below the 5,000-point mark for the first time since November 2006. The Doha Securities Market ended the week almost flat at 6,635.60 points, supported by announcements from some leading companies that they would distribute better-than-expected dividends.
The Bahrain Stock Exchange ended the week down about four per cent and is down 33.5 per cent on the year. Although some of the seven markets are trading higher than their lowest points this year, their market capitalisation has dropped by about $520b from their year-ago value of $1.116tn. * AFP