Azernews.Az

By Bloomberg

Dubai stocks retreated to the lowest since January following global equities lower after OPEC reduced its estimate for 2015 oil demand and crude prices extended a slump.

The DFM General Index dropped 6.6 percent at 11:48 a.m. local time to 3,628.09, the weakest since Jan. 20, bringing its decline so far this week to 13 percent, the worst since October. Emaar Properties PJSC, the real estate developer that accounts for almost 18 percent of the gauge, slipped to the lowest level since February. The ADX General Index in neighboring Abu Dhabi, home to almost 6 percent of the world’s proven oil reserves, sank 4 percent to the weakest in 11 months.

“We are highly correlated at least psychologically with the international markets, especially the reaction towards oil price,” Wadah Al Taha, chief investment officer at Al Zarooni Group, said by telephone. “We will probably head down further in the next few sessions. Some foreigners may be exiting the market, probably selecting other attractive emerging markets that may benefit from a decline in oil prices.”

Equity markets worldwide tumbled after the 12-member Organization of Petroleum Exporting Countries yesterday cut its forecast for demand next year to the lowest level in 12 years, raising concern over the strength of the global economy and leaving investors contemplating when oil’s plunge will reach a bottom. Brent Crude fell below $65 a barrel for the first time since 2009.

The selloff sent the MSCI All-Country World Index and the Standard & Poor’s 500 Index to their biggest drop in two months yesterday. In Saudi Arabia, the world’s biggest oil exporter, the Tadawul All Share Index retreated to the lowest in a year.

Emaar Drops

Emaar declined 8.2 percent to 7.30 dirhams. Dubai Islamic Bank PJSC, the second-biggest stock on Dubai’s gauge, lost 8.8 percent to 6.11 dirhams, the lowest since June. In Abu Dhabi, Aldar Properties PJSC fell 8.9 percent to 2.55 dirhams, the lowest in a year.

Qatar’s QE Index lost 3.2 percent, Kuwait’s SE Price Index dropped 1.5 percent while Bahrain’s measure was little changed.