Saudi, Dubai stocks tumble on Syria tension
Dubai, August 27, 2013
Saudi Arabia's stock index dropped 2.8 percent in the opening minutes of trade while Dubai's index extended its losses to 4.4 percent in response to the possibility of international intervention in Syria.
It is not clear that any escalation of fighting in Syria will necessarily affect the Gulf states, some of which have been supporting the Syrian rebels for many months without suffering negative effects.
But Gulf markets have risen sharply this year - Dubai is still up 62.1 percent in 2013 and Saudi Arabia up 15.4 percent - so retail investors, who have dominated trade in the past few weeks, are dumping stocks to lock in gains, traders said.
"Geopolitical concerns are causing people to exit," says Fouad Darwish, head of brokerage services at Global Investment House.
"Institutional investors have a floor and once that's gone, they'll be out of the market...The markets of the UAE and Saudi Arabia will be hit harder."
Kuwait's benchmark retreated 2.4 percent, trimming its 2013 gains to 31.5 percent. - Reuters