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Dubai Financial Market drops on Iran-West crisis

Shares in Dubai dropped 1.5 per cent to close at 5,427.45 points while those in Abu Dhabi recovered with a rise of 0.1 per cent at 5,087.96. All 25 companies traded on the Dubai Financial Market (DFM) General Index declined, with Emirates Integrated Telecommunications Co, or du, sliding after a report that telecom companies must cut prices for fixed-line calls. du slipped 1.9 per cent to Dh5.64 while Al Salam Bank - Sudan was the biggest loser at 15 per cent to Dh5.10.

Gulf Navigation Holding, a major player in the region's shipping and marine services industry, declined 3.6 per cent to Dh1.63 followed by Ajman Bank, which slipped 3.4 per cent to Dh3.15. The bank, however, continued to pace DFM with shares value amounting to Dh234.8 million.

Motaz Irshaid, an institutional sales trader at Al Futtaim HC Securities, said in a Bloomberg report that the diplomatic crisis between Iran and the West over Teheran's nuclear programme is making investors cautious. "There is negative sentiment in the market and uncertainly on where this conflict is heading," he said.

Iran's state-run Fars news agency reported that Teheran would close the Strait of Hormuz, through which the bulk of Middle East oil is shipped, if the country is attacked by the US. Emirates Telecommunications Corp, the UAE's biggest phone company, gained 0.8 per cent to Dh20.20 in Abu Dhabi trading. Oman and Emirates Investment Holding Co topped the Abu Dhabi Securities Exchange (ADX) General Index with a jump of 10 per cent to Dh3.85 and Aabar Investments added 9.3 per cent to Dh4.85.