Dubai slides most since June

Property stocks are hit hard as the eurozone debt crisis rears its head and Spain is put in the spotlight.

First Gulf Bank was among the losers yesterday. Jeff Topping / The National

Stocks in Dubai fell by the most in three months as risk aversion grew on world markets and European equities fell over concerns about Spain's public finances.

The Dubai Financial Market General Index lost 1.8 per cent to 1,562.92, the biggest intraday decline since June 3, while the Abu Dhabi Securities Exchange General Index was down 0.3 per cent at 2,597.58.

Emaar Properties led the fall on Dubai's market, slipping 2.7 per cent to Dh3.48 each, followed by Arabtec Holding and Dubai Investments.

In the capital, First Gulf Bank, Etisalat and United Arab Bank fell, while a 5.2 per cent increase in RAK Bank shares - on very thin volumes - helped to steady the index.

A mixture of international economic jitters and the strong performance of Dubai's market so far this year was convincing some investors to pull back, said Tariq Qaqish, the deputy head of asset management at Al Mal Capital.

"We used this opportunity … as a chance to invest and accumulate," he said. "We don't see any fundamental change. It's all driven by the correlation with international markets, plus profit taking."

Global markets sold off over fears about whether Spain's government could hold its autonomous regions to the terms of a euro-zone bailout deal, after Artur Mas, Catalonia's president, called for early elections on November 25.

The Nikkei 225 fell 2 per cent to 8,906.70 while the Hang Seng Index was down 0.8 per cent at 20,527.73. European markets opened sharply lower, while oil prices declined, with Brent crude futures sliding 52 cents to $110.15 a barrel.

Elsewhere in the Gulf, all other markets fell except for Kuwait's. The Saudi Tadawul All-Share Index fell 1.4 per cent to 6,878.72.