Gulf markets hit by Eurozone rate cuts

 
City A.M. Reporter
DUBAI’S benchmark stock index fell to the lowest level in more than seven years after France and Austria were stripped of top credit ratings.

Trading in other Gulf markets also suffered yesterday after S&P also downgraded Italy, Spain and Portugal.

Dubai’s benchmark slumped dipped 1 per cent and Abu Dhabi’s benchmark declined 0.7 per cent to close at its lowest since 21 December.

“A lot of the downgrades were expected but it brings Europe’s problems to the frontlines and enhances the negative sentiment,” said Rami Sidani, Schroders Middle East head of investment.

Bellwether Emaar Properties slipped 2.4 per cent and Emirates NBD shed 2.2 per cent.

Abu Dhabi-listed Dana Gas dropped 7.5 per cent to close at an all-time low, while Sorouh Real Estate fell 4.2 per cent, also a record closing-low.

“The downgrading of Europe is adding more pressure on the companies that still have foreign ownership in them,” said Mohammed Yasin, of CAPM Investment.

“That will spread to all regional markets during this week, especially if European markets go through a sell off when they open tomorrow,” he added.

Elsewhere, Qatar’s index ended 0.7 per cent lower, down in six of the last seven sessions.

Masraf Al Rayan fell 2.4 per cent, Industries Qatar slipped 0.8 per cent and Qatar National Bank eased 0.3 per cent.

In Saudi Arabia, the index eased 0.04 per cent to halt a three-session rally but volumes hit a three-week high.

In Egypt, stocks extended a rally for a fifth session as Ezz Steel gained 9.6 per cent on reports that a dispute over factory licences had been resolved with the government.