Dubai’s stock market has slumped on the first day of trading since news of its debt crisis broke.
The emirate’s equity benchmark closed down 7.3 percent. It was a similar story in neighbouring city-state Abu Dhabi, where shares ended trading more than eight percent down. The stock exchanges reopened today after a religious holiday. The business hub of the world’s top oil exporting area, Dubai sent shockwaves worldwide last week by asking for a delay in repaying billions of dollars of debts. But fallout from the potential default looks limited with early trading in Europe relatively calm. Investors there seem reassured after the United Arab Emirates offered Dubai help in resolving the crisis. Its central bank is to provide emergency liquidity to banks, helping calm international nerves.