Gulf stocks hit hard after OPEC maintains output quota

(MENAFN- AFP) Share prices in Gulf Arab states plunged Sunday on the first day of trading since OPEC decided to maintain oil output, sending crude prices to five-year lows, analysts said.

All the seven bourses of the Gulf Cooperation Council (GCC) states had been closed for the Friday-Saturday weekend after the OPEC decision late Thursday.

The Saudi Tadawul All-Shares Index, the largest in the Arab world, slumped more than 6.0 percent to below the 9,000-point mark. All shares and all sectors were trading lower.

Losses on the Dubai Financial Market deepened by mid session, trading down 6.5 percent at around 4,200 points. All stocks in the index were in the red.

The Abu Dhabi Securities Exchange was down 1.0 percent at 4,753.0 points.

Kuwait Stock Exchange had dipped 3.0 percent to 6,776.50 points, while Muscat Stock market had lost 5.6 percent.

Qatar Exchange dived 4.4 percent below the 13,000-point mark less than five minutes after opening.

The OPEC oil cartel on Thursday maintained its output ceiling unchanged despite sliding crude prices.

"This is a direct impact of the OPEC decision and the fear from the low oil price consequences" on Gulf economies, said Ziad Chehab, vice-president of investment research at Kuwait's KAMCO investments.

"I think Gulf stock markets are expected to continue to bleed for some time to come," he said.

The OPEC decision was received positively by global stock markets because a drop in oil prices is expected to stimulate Gulf economies. On the contrary, a drop in oil prices would have reflected negatively on GCC budgets which generate about 90 percent of their revenues from oil.