Economy of the Middle East (new thread)

Pav · Dec 23, 2008

Today's excerpts from Gulf News:

UAE stock markets continue decline in early trading

Agencies
Published: December 23, 2008, 10:55

Dubai: Stock markets in the UAE decline in early trading on Tuesday after falling to their lowest closes in more than four years on Monday, while Oman's benchmark edges back from a more than 20-month low.

The Dubai index falls 0.48 per cent to 1,723 points and Abu Dhabi sheds 0.29 per cent to 2,495 points. Real estate and construction pace the declines, with Aldar Properties losing 3.33 per cent and Arabtec Holding shedding 5.44 per cent.

In Oman, Oman Cable Industries tumbles 9.97 per cent, pushing the benchmark down 0.2 per cent to 5,770 points.

Kuwait's main index rallies in early trading, steered by Mobile Telecommunications Co and National Bank of Kuwait(NBK), after the finance minister said a state fund would begin buying shares on Wednesday.

The benchmark jumps 2.54 per cent to 8,419 points. Zain gains 7.22 per cent and NBK 8.33 per cent.

Global Investment House is unchanged, having fallen more than 5 per cent in early trading, as the investment bank continues debt renegotiation talks with creditors.
Click to expand...

UAE real estate stocks plunge, dragging benchmarks

By Gaurav Ghose, Financial Features Editor
Published: December 22, 2008, 11:17

Dubai: About Dh29 billion has been wiped off the UAE's stock markets in two days of steep losses that left them at lows last seen more than four years ago.

And the coming days do not look good, say some analysts.

"Real estate and the banking sectors are facing a tough time with many [loan] defaulters. With the realty sector facing a major correction, the near term story for UAE market looks negative," said Shiv Prakash, equity investment analyst at Mac Sharaf Securities.

The real estate and banking sectors have been among the worst performers this year.

The slump in oil prices, which fell below $40 (Dh147) this week, is also likely to weaken region's economic growth, aggravating the already frayed sentiments of the investors.

At the close of business yesterday, the Dubai Financial Market General Index closed 3.91 per cent lower to 1,732.20. The benchmark has slumped about 71 per cent this year. Abu Dhabi Securities Exchange lost 2.88 per cent to end at 2,502.22.

Union Properties, which announced that it is seeking to sell bonds worth Dh2.5 billion to its "strategic investors", tumbled to its lowest in almost six years, closing at Dh0.87, down 8.42 per cent. The latest move illustrates that project financing is still difficult and liquidity shortages are far from over.

"It had no alternative but to go for bonds to mop up funds," said Prakash. "Banks are very cautious in lending and credit squeeze is still very much a problem. And I cannot say that there will be any price appreciation of Union Properties because of its latest move."

Shuaa Capital, the largest investment bank in the country, fell for the eighth day, plunging 9.65 per cent to end at Dh1.03. The bank sought approval of extending the maturity of their convertible bonds to next month.

Emaar Properties, the largest property developer in the region, dropped 4.94 per cent to Dh2.50. The stock has fallen about 15 per cent in the past three days. Arabtec, the largest construction company in the UAE, was the biggest loser, tumbling 100 per cent to Dh4.23.

In Abu Dhabi, Aldar Properties lost 8.08 per cent to Dh4.21. First Gulf Bank and Abu Dhabi Commercial Bank slid 9.25 per cent and 7.69 per cent to Dh8.24 and Dh1.80 respectively.
Click to expand...

I guess the market correction has yet to come. At least in R/E.

arezzo · Dec 23, 2008

Things are going to get alot worse before they get better, the consensus across the board is that this going to be a long one, clearing the leverage running through the veins of the global economy is going to be a long drawn out process and the GCC is no different (although I've heard of some pundits claim the GCC will bounce back sooner than the rest of the world but what they fail to realize there is an information black out as far as all the bad news is concerned, trying to keep it under wraps for as long as they can.)

I wouldn't be surprised if the GCC and other SWFs (China, Norway) around the world have had 50% or more wiped off their pre-credit crunch NAVs but at the end of the day we just don't know do we

S

Pav said: ↑

Today's excerpts from Gulf News:

I guess the market correction has yet to come. At least in R/E.
Click to expand...

sir-t · Dec 23, 2008

arezzo said: ↑

Things are going to get alot worse before they get better, the consensus across the board is that this going to be a long one, clearing the leverage running through the veins of the global economy is going to be a long drawn out process and the GCC is no different (although I've heard of some pundits claim the GCC will bounce back sooner than the rest of the world but what they fail to realize there is an information black out as far as all the bad news is concerned, trying to keep it under wraps for as long as they can.)

I wouldn't be surprised if the GCC and other SWFs (China, Norway) around the world have had 50% or more wiped off their pre-credit crunch NAVs but at the end of the day we just don't know do we

S
Click to expand...

100% agree Arezzo.
But let's wait for the next "expert" who shows news from a UAE website

menoy · Dec 24, 2008

"Arabtec, the largest construction company in the UAE, was the biggest loser, tumbling 100 per cent to Dh4.23."

What?

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