Saudi Gulf stocks dive over global growth fears oil prices
(MENAFN- Arab News) KUWAIT CITY: Share prices in the Gulf states nosedived with investors spooked over global growth fears declining oil prices and conflicts analysts and traders said.
The Saudi stock market the largest in the Arab world dived 6.44 percent during trading to its lowest level in the year. The Tadawul All Share Index was down 706.1 points (6.51 percent) at 10145.38 points.
The decline was led by the Dubai Financial Market whose main index shed 6.54 percent to close at 4619.60 points its lowest level in about three months.
Abu Dhabi bourse dropped 3.5 percent Qatar Exchange lost 3.0 percent while Kuwaiti shares closed down 1.0 percent.
"The markets are certainly impacted by the continued drop in the prices of oil which generates most of the income for the Gulf states" Ziad Chehab vice president for research at Kuwait's KAMCO investments.
Since June Brent crude has lost about $25 a barrel to fall below $90 a barrel the lowest in four years.
"The geopolitical events and fighting in the region are weighing heavily on the Gulf stocks. The International Monetary Fund lowering of global growth forecast is also influencing regional shares markets negatively" Chehab said.
The falls came after major stock markets around the world lost ground following the gloomy IMF forecasts.
The IMF on Tuesday trimmed its 2014 global growth forecast to 3.3 percent down 0.1 percentage point from July as it warned of stagnation in advanced economies and highlighted risks from the Russia-Ukraine crisis strife in the Middle East and the Ebola epidemic.
The Fund lowered its growth forecasts for the Middle East and North Africa region to 2.6 percent from the 3.2 percent it projected in April mainly because of conflicts.
The IMF said the six states of the Gulf Cooperation Council which pump 17 million barrels of oil daily will grow at 4.5 percent in 2014-2015.
But it stressed the six would stop posting budget surpluses in 2017 because of the sharp drop in oil prices and high spending.
The GCC states posted huge budget surpluses for most of the past 15 years due to high oil prices.
According to Sovereign Wealth Funds Institute they have assets worth $2.45 trillion managed by their sovereign wealth funds.
The Saudi stock market the largest in the Arab world dived 6.44 percent during trading to its lowest level in the year. The Tadawul All Share Index was down 706.1 points (6.51 percent) at 10145.38 points.
The decline was led by the Dubai Financial Market whose main index shed 6.54 percent to close at 4619.60 points its lowest level in about three months.
Abu Dhabi bourse dropped 3.5 percent Qatar Exchange lost 3.0 percent while Kuwaiti shares closed down 1.0 percent.
"The markets are certainly impacted by the continued drop in the prices of oil which generates most of the income for the Gulf states" Ziad Chehab vice president for research at Kuwait's KAMCO investments.
Since June Brent crude has lost about $25 a barrel to fall below $90 a barrel the lowest in four years.
"The geopolitical events and fighting in the region are weighing heavily on the Gulf stocks. The International Monetary Fund lowering of global growth forecast is also influencing regional shares markets negatively" Chehab said.
The falls came after major stock markets around the world lost ground following the gloomy IMF forecasts.
The IMF on Tuesday trimmed its 2014 global growth forecast to 3.3 percent down 0.1 percentage point from July as it warned of stagnation in advanced economies and highlighted risks from the Russia-Ukraine crisis strife in the Middle East and the Ebola epidemic.
The Fund lowered its growth forecasts for the Middle East and North Africa region to 2.6 percent from the 3.2 percent it projected in April mainly because of conflicts.
The IMF said the six states of the Gulf Cooperation Council which pump 17 million barrels of oil daily will grow at 4.5 percent in 2014-2015.
But it stressed the six would stop posting budget surpluses in 2017 because of the sharp drop in oil prices and high spending.
The GCC states posted huge budget surpluses for most of the past 15 years due to high oil prices.
According to Sovereign Wealth Funds Institute they have assets worth $2.45 trillion managed by their sovereign wealth funds.
Legal Disclaimer:
MENAFN provides the
information “as is” without warranty of any kind. We do not accept
any responsibility or liability for the accuracy, content, images,
videos, licenses, completeness, legality, or reliability of the information
contained in this article. If you have any complaints or copyright
issues related to this article, kindly contact the provider above.
Comments
No comment