UAE markets suffer heavy losses

Robin Wigglesworth and Simeon Kerr
FT
Monday, Nov 30th, 2009

Stock markets in the United Arab Emirates fell sharply on Monday, as worries over defaults in the region's business hub of Dubai depressed sentiment and sent local and international investors heading for the exit.

Meanwhile, Nakheel, the company at the centre of Dubai's financial woes, on Monday asked for all three of its sharia-compliant bonds worth $5.25bn to be suspended from trade "until it is in a position to fully inform the market" in its first statement to investors since last week's shock request from Dhubai World, its parent, for a bond payment to be delayed for six months.

Gulf markets, which had been closed since Wednesday's late announcement due to the Muslim Eid al-Adha holiday, fell sharply on Monday. Asian equity markets rebounded but European markets were more cautious as investors worried about renewed banking sector problems.

The Dubai Financial Market, which trades in local currency, slumped more than 7 per cent in early afternoon trading, and the Abu Dhabi Stock Exchange, the third bourse in the United Arab Emirates, lost more than 8 per cent in heavy trading.

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