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Gulf bourses lose $52bn amid oil price plunge

Gulf bourses lose $52bn amid oil price plunge

 

By: Ramy Sameeh

Cairo - Mubasher Exclusive: Gulf stock markets have incurred massive losses on Tuesday as the plunge in oil prices continued.

The six Gulf countries lost more than $52 billion, with the Saudi Stock Exchange (Tadawul) making up the lion’s share with $32 billion, followed by the UAE bourses and the Qatar Exchange (QE) with $11.4 billion and $6 billion respectively, according to statistics compiled by Mubasher.

Falling oil prices continue to affect markets, resulting in negative performance in Gulf stock exchanges which have reached very low levels, Mohamed Al-Aasar, Head of the Technical Research Department at Al Watany Capital, told Mubasher in a comment, adding that it is expected that this decline will continue in the Gulf region until news of a recovery in the prices of oil is announced, added to a stability in global markets.

Oil prices retreated on Tuesday, nearing $59 per barrel for the first time since May 2009, continuing a wave of declines that has extended over a six-month period. This massive price-fall began following the OPEC’s decision late last month to maintain the production ceiling without any change. Losses reached 50% after the price per barrel in June 2014 stood at $115.

“We have noticed strong buying by foreign institutions, which were intent on buying stocks and seizing opportunities amid this price decline,” Al-Aasar remarked.

Saudi Arabia’s Tadawul, the largest stock exchange in the region, led declines after its benchmark index nose-dived by 7.27% to 7330.30 points, its worst daily performance in six years and its lowest level in 18 months.

Meanwhile, the two UAE stock markets reached their lowest level in over a year, as the Dubai Financial Market (DFM) plunged by 7.27%, its third highest daily loss this year, to 3083.69 points, whereas the Abu Dhabi Securities Exchange (ADX) plummeted by 6.9%, its worst daily decline in nine years, closing at 3892.08 points.

Qatar’s QE dropped 3.51% to 11057.33 points, the market’s lowest level in 11 months. However, it succeeded in maintaining some of its gains achieved since the start of 2014.

The Kuwait Stock Exchange (KSE) plunged to its lowest level in 23 months after its Price Index retreated by 2.08% to 6170.93 points amid a semi-collective decline of all its stocks.

Oman’s Muscat Securities Market (MSM) fell 2.92% to 5409.4%, its lowest level in 28 months or since August 2012.

Finally, the Bahrain Bourse escaped this wave of declines after the Bourse decided to take two days off on the occasion of the Kingdom’s National Day, with trading set to resume on Thursday, December 18, 2014.

 

Translated by: Nada Adel Sobhi

 

Photo Credit: Arabianeye-Reuters