Most Gulf stock markets dropped Sunday a day after Saudi shares tumbled over five percent as news of the historic US credit downgrading sent jitters through the region's markets. However, the Saudi stock benchmark Tadawul All Share Index regained its balance to close Sunday 0.08 percent higher at 6,078.05 points. It shed 5.46 percent of its value Saturday. SABIC dipped a quarter percent to SR97.50. Investors seem to take a wait-and-see approach as the US markets will resume trading Monday. Elsewhere, Dubai Financial Market's benchmark index suffered some of the region's steepest declines Sunday, tumbling more than 5 percent in early trading. It closed down 3.7 percent at 1,484 points. In Abu Dhabi, the General Index closed down 2.53 percent at 2,603.22 points after opening in the red, with banks losing 3.30 percent and property shedding 5.61 percent. The Kuwait Stock Exchange closed 1.61 percent down at 5,927.8 points, while the Qatar Exchange, which has overtaken Kuwait as the second largest Arab bourse, closed 2.51 percent down at 8,277.61 points. The Bahrain Bourse closed 0.33 percent down at 1,276.86, while Oman's Muscat Securities market closed 2.08 percent down at 6,150.19. “I believe it was more of a psychological effect from inflated media reports about the dire consequences of the downgrade. It was a panic sale,” Kuwaiti economist Ali Al-Nimesh said Sunday. “Tomorrow, the Gulf markets will be more stable and some of them are likely to recover part of today's losses,” Nimesh said. Moreover, Egypt's benchmark EGX30 index fell more than 4 percent. The Egyptian Exchange's head, Mohammed Abdel-Salam, attributed the slide to declines in world markets rather than the fundamental value of the country's companies. Farouk Miah, an analyst at NCB Capital in Riyadh, said Mideast traders are concerned that debt problems in the West could cut demand for crude and drag on oil-dependent economies in the region. He expects Mideast markets to slump further if other global markets tumble on the US debt downgrade.
