Stock News: Gulf Markets Choppy; Zain Saudi Plunges

Most Gulf stock markets declined further on Monday, albeit at a much slower pace than a day earlier, as investors responded to attempted rebounds with renewed selling.

Oil fell nearly $2 a barrel in Asian trade on Monday and both U.S. crude and Brent have fallen for five straight months. Brent, which was trading at $68.36 a barrel, has fallen about 40 per cent from June’s 2014 high.

Dubai’s benchmark was down 2.3 per cent at 4,182 points at 0850 GMT after dropping as much as four per cent to 4,122 points earler in the session.

Most stocks were in the red and Emaar Properties tumbled its daily 10 per cent limit.

Sunday was the record date to qualify for Emaar’s special dividend of Dhs1.257 per share, which is linked to the initial public offering of subsidiary Emaar Malls Group in October.

Abu Dhabi, Qatar and Kuwait fell 0.4 per cent each, while Oman lost 1.1 per cent.

Saudi Arabia’s index was up 0.5 per cent in volatile trade, having given back initial gains only to rebound again.

Loss-making telecommunications firm Zain Saudi tumbled by its daily 10 per cent limit for a second day in a row, slumping to an all-time low of SAR7.25.

At the end of last week, the company proposed cutting its capital to eliminate all accumulated losses up to Sept. 30.

Zain Saudi also cut its capital in 2012 to SAR4.8 billion ($1.28 billion) from SAR14 billion, subsequently launching a rights issue that raised its capital SAR10.8 billion.

Fears of another rights issue, which would force investors to commit more cash or have their holdings diluted, may have sparked this week’s sell-off.