Dubai Credit Crisis Continues to Hammer Stocks

Stock prices continued to fall today in Dubai today as fears grow that Dubai’s largest development companies will miss upcoming payment deadlines. The Dubai index has now fallen more than 20 percent since news first broke on the credit crisis, while the main Dubai Financial Market index fell another 6% on Monday.

Since Dubai World first asked for a six-month delay on debt repayments two weeks ago, credit agencies have downgraded many leading Dubai companies. One of Dubai World’s first major repayments to bondholders in its property firm Nakheel is due next week.

“Until there is some clarity in debt restructure, there won’t be any serious buyers [of shares],” said Julian Bruce at EFG Hermes Holding in Dubai.

“The closer we get to the Nakheel deadline with no news, the worse it will be.”

BBC News

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