x Abu Dhabi, UAE Thursday 20 July 2017

Kim's death rattles markets

Fears in the Korean peninsula spark a sell-off on Asian markets, bruising stocks in the UAE as volumes peter out.

The Korea Composite Stock Price Index in Seoul dropped on the news of Kim Jong-il's death yesterday. Lee Jin-man / AP Photo
The Korea Composite Stock Price Index in Seoul dropped on the news of Kim Jong-il's death yesterday. Lee Jin-man / AP Photo

Political tensionon the Korean peninsula after the death of Kim Jong-il sparked fears of a messy transition of power in North Korea, weighing on local markets.

Asian stocks began the week falling as uncertainty over the region prevailed, with a 3.4 per cent dip in South Korea's Kospi index.

Fears on Asian markets filtered through to the Middle East, said Rami Sidani, the head of Middle East and North Africa portfolio management at the fund manager Schroders.

"Korea triggered a sell-off in Asian markets in the morning. This has weighed on the open in the regional markets," he said.

As trading dwindled, stocks in the capital suffered another bruising day. The Abu Dhabi Securities Exchange General Index slid 0.7 per cent to 2,393.28, extending its slump.

The capital's big lenders, including National Bank of Abu Dhabi, First Gulf Bank and Abu Dhabi Commercial Bank joined Aldar Properties, Sorouh Real Estate and Etisalat in pushing the index down.

The Dubai Financial Market General Index rose 0.1 per cent to 1,374.20, led by Mashreq bank and Arabtec.

European markets opened higher. France's CAC 40 was up 1.1 per cent to 3,007.67, while Germany's DAX rose 1 per cent to 5,759.87. The FTSE 100 was flat at 5,393.17.

All other bourses in the Gulf fell, with the exception of the Saudi Tadawul All-Share Index, which rose 0.1 per cent to 6,275.92.

Egypt's EGX 30 Index rose 0.5 per cent to 3,802.22 after 3.4 per cent on Sunday.

ghunter@thenational.ae