Dubai joins global market rout after Greece voters reject austerity deal

Dubai shares fell, joining a global equity sell-off as investors speculated that Greece may leave the euro zone after an austerity bailout deal between the country and its creditors was overwhelmingly rejected in a countrywide referendum.

The Dubai Financial Market General Index dropped 1.2 per cent and stock screens across markets in Asia were soaked in red. The Abu Dhabi Securities Exchange General Index fell 0.1 per cent.

Shares of Emaar and Dubai Islamic Bank led the declines in Dubai. Stocks in developing countries were among the worst-hit. The benchmark MSCI Emerging Market index dropped 2.5 per cent as investors dumped some of the world’s most riskiest assets. UAE stocks were included in the index last year.

Other asset classes were equally affected, with commodity prices suffering similar declines. Brent crude shed 1.4 per cent to US$59.35 a barrel. Meanwhile, the euro declined 0.5 per cent to 1.1053 against the dollar.

Voters in Greece yesterday rejected decreased spending and tax increases with a majority of 61 per cent, raising questions as to how stalled talks between the southern European country and its creditors, which include the European Central Bank and the IMF, will continue.

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