Banking shares led the declines on the Dubai Financial Market yesterday as investors speculated Europe's debt crisis may hurt the country's financial sector.
Dubai market slides but Abu Dhabi rides higher
Dubai's shares fell yesterday, weighed down by banking stocks, as investors speculated that the European debt crisis may put pressure on the country's financial sector.
Dubai Islamic Bank slipped 1.5 per cent to Dh1.95 a share. Tamweel, the mortgage finance company, was down 0.8 per cent to 70 fils a share.
The Central Bank on Thursday said deposits dropped 3.2 per cent to Dh1.07 trillion in August from July. Loans rose 0.5 per cent to Dh1.056tn during the same period.
"It's mostly foreign institutional depositors who are pulling out their money, similar to what happened in 2008," said Nabil Farhat, a partner at Al Fajer Securities in Abu Dhabi. "It's putting some pressure on the financial system, because the banks are publicly listed and the stock market is transparent, you can see it," he said.
Shuaa Capital, the country's largest investment bank, jumped the highest in more than a month, up 5.5 per cent to 79 fils after announcing it appointed Michael Philipp to its board. Mr Philipp was previously the chairman and chief executive at Credit Suisse Europe, Middle East and Africa.
The Dubai Financial Market General Index lost 0.3 per cent to 1,426.54, 10 points away from its lowest close since March 8.
By contrast, the Abu Dhabi Securities Exchange General Index was up 0.1 per cent to 2,535.84.
Elsewhere in the region: Kuwait's index added 0.1 per cent to 5,839.20; Bahrain's measure rose 0.9 per cent to 1,176.89; Oman's index lost 0.1 per cent to 5,594.23; and Qatar's benchmark dropped 0.4 per cent to 8,356.77. The Saudi Tadawul All-Share Index was little changed at 6,112.41.