Gulf stock markets closed the week lower amid pressure on global bourses triggered by Greece's debt crisis, financial analysts said Friday. Expectations were that the impact of the debt issue on Middle East markets would taper off when investors come to realize the fall-out would be minimal. “Gulf banks don't have any specific exposure to Europe, especially not Greece, but are always hit first when investors are scared,” said Nour Al-Zoubi, general manager at MAC Sharaf Securities in Dubai. “Investors are also slightly disappointed over Q1 results.” “The backdrop to international markets remains weak,” said Ali Khan, head of cash-equity trading at Dubai-based Arqaam Capital Ltd. Kuwait led a decline in Gulf shares as stocks slid globally amid a deepening debt crisis in Europe that threatens to slow an economic recovery and as oil tumbled to a six-week low. Agility, the Middle East's largest storage and logistics company, dropped to the lowest in two weeks. Kuwait's KSE all-share index dropped 2.5 percent, closing at a 10-month low of 7,114. The weekly report of the Kuwait-based Gulf Invest Co. attributed the decline to a liquidity shortage and lack of buying desire on the part of leading traders due to the Greek debt crisis and regional geopolitics, particularly the standoff over the Iranian nuclear file. “The situation for the investment companies remains tough and continues to put pressure on the market,” said Samer Al-Jaouni, general manager of Middle East Financial Brokerage. Dubai's DFM General Index lost 0.1 percent, bringing the decline for the week to 0.4 percent. Dubai Islamic Bank PJSC, the United Arab Emirates' largest Islamic lender, retreated the most in more than a week after it said first- quarter profit slumped 46 percent. “There is a low turnover due to the Greece debt problem but European markets are turning into a profit again, which may be an indicator there will be some rebound regionally,” said Marwan Shurrab, vice-president at Gulfmena Alternative Investments. However, Abu Dhabi's all-share index edged higher, closing at 2,791 from last week's close at 2,777. “We believe that regional markets are coming under unjustified psychological pressure of plummeting world markets as a result of the European debt crisis,” another investment analyst said. “Falling oil prices due to shrinking global demand are also expected to put downward pressure on regional stocks.” Nevertheless, Saudi stocks remained steady this week, receiving support from the first quarter results and the country's macroeconomic strength, analysts said. The Tadawul All Share Index (TASI) of the Arab world's largest stock exchange shed 0.7 percent, closing at 6,817.86. “Investors are apparently eyeing efforts under way to come to grips with Greece's debt crisis,” said Mohammad Emran, a member of the Saudi Economic Society. “We expect linkage between global and Gulf markets to become stronger due to concerns Greece's debt worries could spill over to other European countries,” he added. The benchmark of the Dubai stock exchange edged lower, closing at 1,734 from 1,740 last week.
