Reuters/Dubai

 

 

Dubai yesterday was the biggest loser among Gulf bourses as fears of a contagion of unrest prevails

Most Gulf bourses fell yesterday, as a revolt against Libyan leader Muammar Gaddafi continued and fear of a contagion in the Middle East prompted investors to exit markets.

A proposal by Venezuela President Hugo Chavez to try to broker a peace deal in Libya briefly pushed oil prices lower and briefly helped stocks markets make some gains. But the benefit was short-lived amid reports of continued fighting in Libya, including air strikes against rebel positions.

The Saudi bourse was closed yesterday, the start of the Saudi weekend, but a sharp fall on the region’s most influential market a day earlier still weighed on the Gulf.

Dubai was the biggest loser yesterday, as its index fell to a new 6-1/2 year low, ending 1.6% lower to 1,352 points.

“The geopolitics of the region is a major concern for investors,” said Marwan Shurrab, vice president and chief trader at Gulfmena Alternative Investments.

“Traders will still prefer to stay on the sidelines. News of the peace deal did move the markets a bit but traders are not fully convinced. There is no catalyst for a rally.”

Heavyweight Emaar Properties fell 3.6% and Dubai builder Arabtec dropped 4.9%.

Kuwait’s Zain made its biggest gains in more than five months after the UAE’s Etisalat said on Wednesday that it was still interested in buying a controlling stake in the company for $12bn. Zain climbed 4.7% to 1.3 dinars.

Etisalat, which offered 1.7 dinars a share for the stake to a consortium led by Kuwaiti conglomerate Kharafi Group, missed its due diligence deadline this week.

“The Kharafi group is probably pretty frustrated by the relatively slow progress of due diligence, with Etisalat missing various deadlines,” said Martin Mabbutt, Nomura telecoms analyst.

“Whether the deal is off, we simply don’t know. If I was a shareholder and I had already pledged my shares to Etisalat, I would be pretty happy with the price agreed.”

The Abu Dhabi benchmark gained 0.1% to 2,530 points while the Omani index rose 0.8% to 6,352 points. The Kuwaiti measure dropped 0.2% to 6,148 points and Bahrain’s index fell 2.3% to 1,377 points.