SHOOT: Those losses will swing world markets around. Sorry.
Amid concerns that markets in the Gulf will be hammered when they reopen on Monday – and that pressure will mount on banks with exposure to Dubai – investors are looking to Abu Dhabi, the main financial powerhouse in the United Arab Emirates federation, to calm nerves. The crisis has undermined the assumption that Abu Dhabi and the federation would bail out Dubai. So far there has been no statement from the federal government or Abu Dhabi.
A rally in the stocks of European banks exposed to Dubai helped the FTSE Eurofirst 300 index recover 1.2 per cent. However, Tokyo suffered a 3.2 per cent fall, its biggest one-day decline in almost eight months.
US markets, closed Thursday for Thanksgiving, sold off heavily in a shortened trading session. The S&P 500 index closed 1.72 per cent down 1,094.33.
HSBC has the biggest loan exposure to the UAE The second biggest lender was Standard Chartered, with $7.8bn. |
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