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10 December 2023

Gulf equities sink as oil falls towards $30

By Reuters

Gulf bourses declined in early trade on Tuesday as Brent crude nose-dived towards $30 and weak Asian markets drained regional risk appetite.

Brent crude was down 3.2 per cent at $30.53 at 0545 GMT as analysts scrambled to cut their 2016 oil price forecasts and traders bet on further price falls.

Dubai's bourse fell 1.7 per cent, taking its 2016 losses to 8.2 per cent, as investors sold off property-related stocks in early trade.

Builder Arabtec declined 2.4 per cent, giving back some of Monday's 3.5 per cent gain.

Emaar Properties and Deyaar Development also retreated, falling 3.6 and 1.2 per cent respectively.

Banks weighed on Abu Dhabi's index, which slid 0.6 per cent, as investors worried about lenders' profitability ahead of fourth-quarter earnings season.

Abu Dhabi Islamic Bank and First Gulf Bank fell 4 and 0.9 per cent respectively.

Standard & Poor's said it expects lower earnings for banks in the UAE in 2016 and a lacklustre performance in 2017.

"We believe uncertainty about how long oil prices will remain weak will force businesses and government to adopt a conservative stance, which will weaken spending for infrastructure and private-sector investments, and rein in bank lending," S&P added.

In Qatar, the benchmark fell 1.1 per cent as all traded stocks declined.

Energy-related companies Gulf International Services  and Qatar Gas Transport each retreated more than 1.4 per cent.

Asian stocks held near four-year lows as investors worried over the extent of China's economic slowdown and its impact on emerging markets.