Stock indices from Kuwait to Abu Dhabi posted heavy losses on Thursday as flight of capital from emerging markets, along with muted oil prices continued to weigh on the sentiment of investors.
The Dubai financial market (DFM) general index lost the most in the oil-rich region, closing off 3.22 percent at 3,709.84 points, the lowest level in almost five months. Uncertainty in emerging markets such as China where the Shanghai index fell by 3.4 percent, along with ongoing pressure on oil prices which stabilized near the six-year low at 41 U.S. dollars per barrel (159 liters).
Arabtec Holding, the biggest construction firm in the United Arab Emirates (UAE), dived 3.88 percent to 1.98 dirham (0.54 U.S. dollars).
Earlier in the day, Arabtec denied media reports saying that it pulled out from a 40-billion-dollar project for thousands of homes for Egyptian army personnel. The largest construction contract ever agreed in the region dates back from an agreement from March 2014.
In an e-mailed statement to the DFM, Arabtec's acting chief executive Mohamed Al-Fahim said "the company denies its withdrawal from the housing project in Egypt and reaffirms that it is still discussing more details with the Egyptian's concerned parties."
Dubai's sister market ADX in Abu Dhabi ended at a two-and-a-half month low at 4,512.48 points.
While financial assets deflate, consumer goods inflate in the UAE. Earlier in the day, Dubai daily Gulf news reported that costs of living rose 4.43 percent in July in the Gulf Arab state, marking the highest level since 2009.
In Kuwait, the stock market measure KSEMI fell by 1.5 percent, while Qatar' QE 20 Index lost 2.50 percent
The Saudi Arabian Tadawul All-Share Index in Riyadh bucked the trend and finished the last day of the Islamic week 0.27 percent higher at 8,012.83 points.