Cairo
26 October 2008
Stock markets in the Gulf and across much of the Middle East experienced another day of dramatic drops Sunday, amid a backdrop of falling oil prices, despite OPEC's decision to cut production. Edward Yeranian reports for VOA from Cairo.
Stock markets in Abu Dhabi and Dubai lost between four and five percent, Oman and Qatar lost between eight and nine percent, and the Egyptian stock exchange dropped more than six percent.
Mohammed Burhan, the executive editor of CNBC al Arabiya network, based in Dubai, said in a telephone interview, he thinks that Gulf markets are reflecting the global economic crisis.
He says, whatever affects global markets affects Gulf Arab markets, as well. He says, "the crisis in the Gulf began a bit ahead of the global crisis, when foreign investment funds began to pull out of the local market," and this affected stock prices.
The Arab daily Asharqalawsat reports that Gulf Finance Ministers and Central Bank chiefs held a closed door meeting Saturday in the wake of investor fears.
In Kuwait, the Central Bank intervened Sunday to halt trading in one of the country's largest banks, after it incurred major losses in currency and stock trades.
A top Gulf economic expert, Wadah el Taha, told Al Arabiya Television that he thinks much of the crisis is the result of widespread investor panic, and that some steps have already been taken, like the insuring of bank deposits in the United Arab Emirates, and the pumping of more liquidity into the system:
He says it is critically important to restore confidence and take steps to support the banking system.