Dubai's market slumped to its lowest level in two months as concerns over the regional and broader global economy weighed on investor sentiment.
Dubai stockmarket hits two-month low
Dubai's market retreated to its lowest point in two months as concerns over the global and regional economies prompted investors to sell.
The Dubai Financial Market (DFM) General Index fell 2 per cent to 1,546.65 points as shares in Emaar Properties, Dubai Islamic Bank and the bourse itself, trading as DFM Company, fell to new lows, weighing on the wider benchmark.
Industry experts said the reported decision by the Dubai Government to cut spending by up to 25 per cent to help the emirate to achieve a budget surplus of Dh3 billion to Dh3.5bn had affected confidence and liquidity in the market.
"You need two things to stimulate the markets; government spending and secondly you have to have relaxed monetary policy to increase liquidity [in the market]," said Nabil Farhat, a partner at Al Fajr Securities.
Gulf General Investment fell to its lowest level since April 14 after it emerged the company, based in Dubai, had defaulted on repayments of almost Dh500 million in bank loans. The company's shares fell 6.5 per cent to 33 fils.
The Abu Dhabi Securities Exchange General Index slipped 0.6 per cent to 2,631.83. RAK Properties experienced the highest volume, while falling 5.1 per cent to 37 fils.
Elsewhere in the region, Doha's market fell nearly 2 per cent to 8,441.35, Saudi Arabia's Tadawul All-Share Index traded 0.7 per cent lower at 6,702.76 and Kuwait's measure closed 0.7 per cent down at 6,443.40.