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Brent crude deepens slide with Dubai index

Brent crude fell more than $2 on Monday, deepening its slide to shed more than 12 per cent after the Opec decision to maintain output on Thursday. The Dubai index also fell as much as 4 per cent to revisit July trough.

Brent crude hit a low of $67.53 a barrel, the lowest since October 2009, before trading 0.56 per cent lower at $69.76 per barrel. Crude is down more than 40 per cent since June.

The 12-member producer group Opec maintained a status quo on production of 30 million barrels per day, a move that can put the shale oil companies in the United States in danger.

“The overall trend would be bearish. We would trade in this range of $64-72 for some weeks due to lack of cues in the market,” said Pradeep Unni, senior relationship manager, Richcomm Global Services.

Both U.S. crude and Brent have fallen for five straight months, oil’s longest losing streak since the 2008 financial crisis.

Dubai falls again:-

Due to falling crude oil, the Dubai index extended losses for a second day to hit its lowest level in than five months.

The Dubai Financial Market General Index closed 2.78 per cent lower at 4,162.33, after hitting a low of 4,109.13, a level last seen in early July.

“What we see today is the erosion of confidence and that’s why we don’t see liquidity coming back to market. Many of the investors will be looking at Saudi markets and US markets,” Mohammad Ali Yasin, managing director at NBAD Securities said.

“We are not looking at internal factors affecting the share market, but external factors like oil and U.S. markets, which is not a very good sign,” Yasin said.

Emaar Properties, which went ex-dividend (a stock is given ex-dividend status if a person has been confirmed by the company to receive the dividend payment), fell to its lower limit of 10 per cent to be at Dh9.54 per share.

Investors had to own the share before today to get the dividend. The company has the highest weightage in the gauge.

Arabtec, which was the most active stock in trade, ended 1.63 per cent higher at Dh3.74.

UAE markets are shut on Tuesday and Wednesday for national day, trade will resume on Thursday.

All other indices in the GCC ended in red, except for Saudi’s Tadawul, which ended 1.11 per cent higher at 8,720.42.

Saudi Arabia, which is the biggest Opec producer and the largest Arab economy, might have to cut its budgets due to falling crude oil prices.

Gulf News
Published on:
December 1, 2014
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