By Zahra Hankir www.businessweek.com
Jan. 17 (Bloomberg) — Dubai’s index dropped for a sixth day, the longest losing streak since March, on concern that Dubai World may have trouble restructuring its debt and in anticipation of fourth-quarter earnings.
Emaar Properties PJSC, the United Arab Emirates’ biggest developer, and Dubai Financial Market, the only Gulf Arab stock market to sell shares to the public, slid to their lowest levels in more than a month. The DFM General Index retreated 2 percent to 1,673.6. Abu Dhabi’s gauge lost 1.2 percent and Qatar DSM 20 Index declined 2.4 percent to 6,691.11, the lowest since Dec. 1.
“The U.A.E. should remain rangebound until fourth-quarter earnings at which point we should begin to differentiate between stocks,” said Ali Khan, head of cash-equity trading at Dubai- based Arqaam Capital Ltd. “Possible headline risk from Dubai World restructuring continues to weigh on the market.”
Dubai World, which on Dec. 1 said it’s seeking to restructure $26 billion of debt, plans to meet with creditor banks this week to complete a standstill agreement, a banker participating in the talks said Jan. 14. A company spokeswoman declined to comment on the negotiations.
The Dubai government said on Nov. 25 the state-run holding company is seeking a “standstill” accord on its debt and that of its Nakheel PJSC unit. Dubai World failed to present a standstill offer in a Dec. 21 meeting with more than 90 lenders because it hadn’t reached an agreement on the terms of government support.
Emaar declined 3.7 percent to 3.39 dirhams, the lowest level since Dec. 13. Dubai Financial Market dropped 4.7 percent to 1.61 dirhams, the lowest since Dec. 10.
The fourth-quarter earnings season in Saudi Arabia is in full swing and will start later this month in the U.A.E. Oil tumbled 1.8 percent to close at $78 a barrel on Jan. 15, bringing its five-day loss to 5.7 percent. The six countries that make up the Gulf Cooperation Council supply about 20 percent of the world’s oil.
Oman’s MSM30 Index slipped 0.2 percent. The Kuwait Stock Exchange Index added 0.4 percent and Bahrain’s index gained 0.1 percent. Saudi Arabia’s Tadawul All Share Index climbed 1.1 percent to 6,393.65.
Editors: Susan Lerner, Claudia Maedler.
To contact the reporters on this story: Zahra Hankir in Dubai at +971-4-364-1037 or email@example.com
To contact the editor responsible for this story: Claudia Maedler at +971-4-364-1025 or firstname.lastname@example.org.