United Arab Emirates’ shares dropped to the lowest in a week, led by Emirates NBD PJSC and National Bank of Abu Dhabi PJSC, on concern slowing economic growth and Dubai World debt restructuring will hurt banking earnings.
Emirates NBD fell the most in a week as the country’s largest bank by assets was cut to “sell” at Goldman Sachs Group Inc. Dubai Islamic Bank PJSC and NBAD dropped more than 2 percent. The DFM General Index lost 2.6 percent to 1,831.41, its lowest close since Dec. 13. The index has slumped 13 percent since Dubai World, the state-owned holding company, said on Nov. 25 it would seek a “standstill” agreement on debt repayments. Abu Dhabi’s ADX General Index fell 0.9 percent to 2,749.08.
“The economic outlook is still uncertain and we don’t know how badly Dubai’s debt problem will hurt banks’ balance sheets,” said Chamel Fahmy, senior regional sales trader at Beltone Securities Brokerage in Dubai. “They will probably need more provisioning to cover their positions. I will stay away from the banking stocks.”
No comments:
Post a Comment