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Middle East stocks plunge amid war fears
Wednesday August 28, 2013 5:42 PM, IINA

GCC stocks dropped Tuesday after the US warned that Syria would be held accountable for its recent actions.

The Saudi Tadawul All Share Index tumbled 4.12 percent in response to the possibility of international intervention in Syria, the Kingdom's biggest stock market drop since August 2011, closing at 7,722.7 points.

The slump put a dent in the Kingdom's stocks, which had previously been up 18.43 percent over the last year.

Saudi financial expert Bishr Bakhit said that "the reason of the drop is the agitation about Syria."

The biggest Saudi losers were the Saudi Fransi Cooperative Insurance Company, which fell 9.93 percent in one day and the Saudi Transport and Investment Company, which tumbled 9.17 percent in just 24 hours.

As markets across the region fell off a cliff face, Dubai's market suffered its largest one-day slump since the emirate's November 2009 corporate debt crisis, as the threat of international military action against Syria prompted jittery retail investors to dump shares.

Dubai's index tumbled 7.0 percent to close at 2,550 points, cutting its year-to-date gains to 57.7 percent. Many analysts had said the market's sharp rise earlier this year left it vulnerable to fierce bursts of profit-taking.

Dubai share prices have dived 7.0 percent, leading the falls as Gulf Arab stock markets took a hit from fears of possible US military intervention in Syria.

Abu Dhabi dropped 2.8 percent to 3,822 points. Kuwait shed 2.9 percent to 7,766 points, while Qatar eased 1.3 percent to 9,771 points.

Oman declined 1.1 percent to 6,846 points and Bahrain shed 1.2 percent to 1,186 points.

Egypt also sank 2 percent to 5,338 points at close. "Politically, the region is in a mess and concerns of war in Syria are high," said Yassir Mckee, wealth manager at Qatar's Al Rayan Financial Brokerage.

"But the extent of the drop doesn't make sense and people are over-reacting because local fundamentals are strong and even if there is a war, I don't see it significantly impacting Gulf countries."

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