27
Nov
Posted by smcinvestmentindia in Asset management, Banking, Bonds, Brokerage, budget, Business, Capital Market, capitals, commodity, Commodity market, Commodity Trading, Company, currency, Distribution of Mutual Funds & IPOs, Economics, Equity & Derivative Trading, Finance, financial planning, futures, General, Import Export, india, India corporate world, Insurance, interest rates, International, Investment, IPO, Mutual Funds, Private Equity, QIP, securities, share market, smc capitals, SMC Depository, SMC Global, SMC online trading, SMC Research Based Advisory Services, Stock, tax, telecom, Trading, Wealth. Tagged: Abu Dhabi, Asia, banking and realty stocks, Bombay Stock Exchange, Brokers, Credit-default swaps, debt, Dollar, Dubai, Dubai's debt, economic crisis, Europe, European indices, expats, financial shocks, global downturn, global financial system, India’s exports, Indian rupee, Indian shares, Investment, MSCI Emerging Markets Index, National Stock Exchange index, Nifty, remittances, Rupee, Sao Paulo, Sensex, Shanghai Composite Index, Sydney, UAE, United Arab Emirates. 2 comments
Just a year after the global downturn derailed Dubai’s explosive growth, the city is now so swamped in debt that it’s asking for a six-month reprieve on paying its bills.
🙂
Dubai Debt Fears Grip World Markets
This has cast a shadow on a world only just emerging from the worst economic crisis since the 1930s, knocking markets from Sydney to Sao Paulo and raising questions about Dubai’s reputation as a magnet for international investment.
🙂
For India, which has tens of thousands of its citizens living and working in the emirate, the concerns are more direct: thousands of its expats staring at job losses and the economy, sharply reduced trade.
India, which gets nearly a quarter of the remittances from the United Arab Emirates and has lakhs of laborers working in the region, could be worse off than most other nations if the crisis escalates into a full-blown one like the Russian or Argentinean crises of the past.🙂
India’s exports to the UAE stood at $23.92 billion in FY09.
It is very likely that we may see one more leg of job losses in Dubai.
The only consolation for the region is that Abu Dhabi is booming.
🙂
Indian shares and the rupee fell in sync with other global markets where investors are fleeing for safety after Dubai debt trap concerns.
The Bombay Stock Exchange benchmark Sensex on Friday tumbled over 451.63 points to 16,403.30 points in the first ten minutes of trading on hectic selling by funds in line with weak global cues and concerns over Dubai’s debt.
Similarly, the wide-based National Stock Exchange index Nifty dropped by 140.50 points to 4865.05 points.
🙂
Brokers said the selling focus was more on banking and realty stocks after Dubai’s debt problems revived concerns about the global financial system and rattled markets across Europe and Asia.
Indian rupee fell 24 paisa to 46.55 against the dollar. The MSCI Emerging Markets Index lost 1.4%.
🙂
Most European indices were about 2% lower after Asia tumbled.
The Shanghai Composite Index slumped 3.6%, its biggest drop since August, and Brazil’s Bovespa Index slipped 1.1%. U.S. markets were closed for the Thanksgiving holiday.
Credit-default swaps tied to debt sold by Dubai rose as much as 131 basis points to 571.
“Dubai isn’t doing risk appetite any favours at all and the markets remain in a vulnerable state of mind,” said Market analysts.
“We’re still in an environment where we’re vulnerable to financial shocks of any sort and this is one of those.”
🙂
Recent Comments