Stocks in the Gulf region tumbled for a second straight session Tuesday as anxiety over Dubai's debt crisis spread to Qatar and Kuwait.
In a public statement, Dubai's ruler stressed federal unity across the U.A.E. amid concern that oil-rich Abu Dhabi will remain on the sidelines as it struggles to restructure the debts of its government-owned companies.
The comments did little to soothe investor nerves. "The Dubai situation has in a way given traders a perfect way to highlight just how fragile market confidence is at the moment," said Ian Griffiths, a dealer at CMC Markets.
The Dubai Financial Market's main index closed down 5.6% Tuesday after falling 7.3% the previous day. A total of $5 billion has now been wiped off the value of the bourse over the past two sessions.
Abu Dhabi stocks closed down 3.6%, while shares in Qatar and Kuwait were also hit, with benchmark measures down 8.3% and 2.7% respectively.
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