Dubai shares declined for the first time in a week on speculation recent gains may be overdone and after U.S. and European stocks retreated on concern the global economic recovery is faltering. Qatar’s benchmark also fell.

Emaar Properties PJSC, builder of the world’s tallest tower decreased the most in six weeks and Dubai Investments PJSC dropped the most since June. The DFM General Index lost 0.9 percent, the biggest intraday decline since Sept. 20, to 1,686.71 at 1:18 p.m. in Dubai. Qatar’s QE Index fell the first day in four, slipping 0.1 percent. Dubai’s index has surged 14 percent this month and Qatar’s has jumped 5.6 percent.
“It’s inevitable that we would see some profit-taking after the recent gains,” said Paul Cooper, managing director at Sarasin-Alpen & Partners Ltd. in Dubai, which oversees more than $500 million in the Middle East. “Dubai had a strong run on the back of the Dubai World announcement and the FTSE Group inclusion.”
The Standard & Poor’s 500 Index dropped 0.3 percent on Tuesday as investors shifted into Treasuries amid speculation the Federal Reserve will purchase more government debt to buoy the economy. “The committee will continue to monitor the economic outlook and financial developments and is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate,” the Federal Open Market Committee said on Tuesday. The Stoxx Europe 600 Index lost 1.2 percent.
Dubai shares gained this month after the FTSE Group listed the United Arab Emirates as an emerging market. Shares of 21 companies including Emaar were added to the FTSE’s Global Equity Index after the close on Sept. 17. The country was classified as a secondary emerging market. Dubai World, one of three main state-owned holding companies, on Sept. 10 received approval from creditors to alter the terms on $24.9 billion of debt.
(Source: Bloomberg)