DUBAI: Most Gulf markets ended lower on Monday, led by sharp losses in Dubai, as the US-Israeli war on Iran continued and oil prices jumped more than 11 percent on supply cuts and fears of prolonged Strait of Hormuz shipping disruptions.
US President Donald Trump said on Saturday he was not interested in negotiations with Iran and suggested the war would end only when Iran no longer had a functioning military or leadership in power.
Further dousing hopes for peace, Iran on Monday named Mojtaba Khamenei as supreme leader to succeed his father Ali Khamenei, signalling that hardliners continue to dominate power.
Energy markets are particularly nervous because the crisis is unfolding around the Strait of Hormuz, through which roughly one-fifth of the world’s oil supply normally passes.
Dubai’s main share index trimmed early losses to close 2.8 percent lower, with blue-chip developer Emaar Properties falling 4.7 percent and toll operator Salik declining 4.9 percent.
The index, which resumed trading on Wednesday after a two-day suspension, has fallen more than 11 percent over four sessions, leaving it down about 5 percent for the year so far.
Budget airliner Air Arabia slumped 5 percent.
In Abu Dhabi, the index eased 0.4 percent, its sixth session of falls, hit by a 4.9 percent slide in Abu Dhabi Commercial Bank.
The Dubai and Abu Dhabi exchanges last week said they would suspend trading in shares falling 5 percent or more.
The cost of insuring against default on sovereign debt issued by several countries in the region rose sharply again on Monday.
Bahrain saw its five-year credit default swaps soar by 23 basis points from Friday’s close to 281 bps, the highest in more than three years; Egypt’s jumped 12 bps, and CDS for Saudi Arabia, Qatar, Abu Dhabi and Dubai all gained 4 bps, data from S&P Global Market Intelligence showed.
Saudi Arabia’s benchmark index fell 1.6 percent, snapping a five-day winning streak, with Al Rajhi Bank losing 3.9 percent and the country’s biggest lender by assets Saudi National Bank decreasing 4.5 percent.
Budget airline flynas fell 4.4 percent, while Saudi Aramco rose 0.7 percent ahead of its annual earnings report due on Tuesday.
Comments