Gulf Arab stocks dive as Yemen crisis escalates

Stock indices from Kuwait to Oman suffered their worst week in 2015 as worsening crisis in Yemen triggered military intervention by Saudi Arabia and its allies in the region.

The equity markets in the six Arab states of the Gulf co-operation council (GCC) started the week in a sluggish mode and continued to lose constantly during the week, falling to multi-month low after Saudi-led "decisive storm" against Shia Houthi rebels in Yemen.

Saudi Arabia said it decided to intervene following a "call for help" from Yemen's president Abd-Rabbu Mansour Hadi to liberate Yemen from Houthi rebels.

The Muscat securities exchange in Oman, Yemen's eastern neighbour country, fell the most on Thursday, ending off 2.58 percent at 6,112.91 points.

On Wednesday, when Houthi militants seized the international airport of Yemen's southern city of Aden where president Hadi stays, the Saudi Arabian Tadawul bourse, the biggest exchange in the Gulf region with 507 billion dollars market capitalization, lost 4.96 percent.

On early Thursday trading, the gauge was down by one percent, trading at two-month low and finally ended up 0.4 percent at 8903.49 points.

Saudi Arabia said a coalition of over 10 states was joining its military campaign which target at first Houthi positions. Besides Saudi Arabia, all states of the GCC, meaning the United Arab Emirates (UAE), Oman, Kuwait, Bahrain and Qatar support the Saudi-led campaign, Al-Jubair said.

Volatility was high at UAE markets in Dubai and Abu Dhabi at the opening on Thursday, but eventually eased over the day.

The Dubai market index DFMGI fell over four percent in early trading, but quickly recovered terrain and closed 0.80 percent lower at 3,407.25 points, the lowest level in 2015 so far.

Real estate shares were hammered in particular, while some financials like Shuaa Capital (up 3.11 percent) bucked the trend.

Earlier in the day, The Dubai Financial Market's mother company Borse Dubai said it sold its entire stake of 17.4 percent in the London Stock Exchange Group.

Investors on the DFM trading floor told Xinhua the mood was negative throughout March and no positive catalysts appeared to trigger a turnaround.

Oil prices and gold, on the other hand, gained due to new geopolitical tensions in the oil-rich Middle East, trading 3.7 percent and 1.2 percent higher, respectively, on late Thursday.

The KSE stock index in Kuwait, which derives 95 percent of its revenues from oil exports, dived 2.42 percent to hit 6,188.73 points.

Abu Dhabi, which harbors seven percent of the world's known oil reserves, saw its equity market index ADX closing 0.03 percent higher at 4,373.13 points. Endit