Aldar declines after job cuts

Markets Wrap: Aldar Properties slumped yesterday after the Abu Dhabi-based developer announced plans to reduce its staff by 24 per cent.

Aldar shares dropped 3.7 per cent yesterday. Matilde Gattoni / Bloomberg News

Aldar Properties yesterday fell the most in two weeks after the Abu Dhabi property developer announced plans to reduce its workforce by 24 per cent.

Its shares dropped 3.7 per cent, the biggest decline since October 17, to trade at Dh1.02.

The developer of Yas Island, home to the Abu Dhabi Grand Prix this month, said on Monday its workforce had been reduced by 105 because of a "less intensive development schedule".

Developers were hit hard by the global financial crisis in 2008, with property prices dropping by as much as 60 per cent from their peak.

"Investors are worried, while business is slow," said Nabil Farhat, a partner at Al Fajer Securities in Abu Dhabi. "The layoffs mean that the business is so bad they can't cover their expenses."

Other property and building material stocks fell. Sorouh Real Estate, the capital's second-biggest developer, dropped 2.9 per cent to 98 fils. Ras Al Khaimah Cement fell 1.2 per cent to 77 fils.

Investor sentiment worsened yesterday after George Papandreou, the Greek prime minister, announced plans to hold a referendum on a new EU bailout deal, re-igniting concerns on the region's debt crisis.

On the Dubai Financial Market General Index, Emaar Properties slumped 2.8 per cent to Dh2.70. Emirates NBD, the country's biggest bank by assets, dropped 4.3 per cent to Dh3.27.

Elsewhere in the region: Kuwait's measure was little changed at 5,916.10; Bahrain's slipped 0.1 per cent to 1,146.39; Oman's MSM 30 Index slipped 0.1 per cent to 5,582.64; and Qatar's QE Index declined 0.7 per cent to 8,529.29. The Saudi Tadawul All-Share Index was down 1.1 per cent to 6,155.10.