How Omicron variant is ‘badly’ affecting Middle East markets

Agencies | Dubai

The Daily Tribune – www.newsofbahrain.com

The new COVID-19 variant, Omicron, has prompted global economic concerns, as fears of its spread begin to affect stock markets and oil prices.

Saudi Arabia’s main market, the Tadawul All Share Index, opened 5.3 per cent lower yesterday, trading near 10,700 points.

The Dubai Financial Market was down 8.49 per cent in early trading, with developer Emaar Properties losing 7.9 per cent, while budget airline Air Arabia plunged 7.1 per cent.

In Abu Dhabi, the index dropped 2.3 per cent, led by a 3.1 per cent fall for First Abu Dhabi Bank, the UAE’s biggest lender, and a 3 per cent drop for telecommunications firm Etisalat.

“It’s obvious that traders are concerned about the implications of the newly mutated virus which brings back the lockdown memories from last year.

If Saudi decides to impose more restrictive measures the economy will be impacted significantly and the growth prospects next year will vanish,” Mohammed Al Suwayed, chief executive officer of Razeen Capital, said.

He said the time is now suitable for investors to reinvest in the market since the share prices are relatively low.

Oil prices stumbled in their biggest decline since April 2020, with Brent prices dropping 11.55 per cent to $72.72 per barrel when markets closed on Friday, while WTI slid 13.06 per cent down to $68.15 per barrel.

Within the Middle East, Israel is the only country to have reported a case of the new variant so far, but some governments in the region have issued travel curbs to prevent the virus from spreading.