FTSE steady despite Emirates market plummet

30 November 2009 8:40 am | By Lee Jones

This morning the FTSE reached 5225, a 0.6 per cent increase, by 8.20am as fears lessoned about the effect of Dubai’s debt crisis. By 10.30 it was slightly up for the day at 5195. The Central Bank of the United Arab Emirates has offered an emergency liquidity facility for local lenders in an attempt to calm the Emirates’ markets.

Last week Dubai World, one of the Emirate’s flagship state property companies, announced it was unable to repay on £3.18bn bonds. The Emirates’ markets have been closed since the start of Eid al-Adha on Wednesday, but reopened this morning with the Dubai Financial Market slumping 5.9 per cent as soon as it opened, and the Abu Dhabi Stock Exchange losing 7.6 per cent in initial trading. The heavy fall was expected as this was the first time investors have been able to react to the debt repayment delay due to the four day religious holiday.

The National Bank of Abu Dhabi fell 9.7 per cent after the markets opened after it revealed more than £200m of exposure to Dubai World. DP World, the ports operator controlled by Dubai World, fell 14.88 per cent on the Nasdaq Dubai. Shares in Emaar Properties, the property group, which built the world’s tallest building the Burj Dubai, fell 9.86 per cent.

According to the Abu Dhabi Securities Exchange, telecommunications and real estate have fallen nearly 10 per cent this morning.

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