Panicked Arab stock markets plunge

KUWAIT CITY, October 7, 2008 (AFP) – Shares plunged across the Arab world on Tuesday as panic over the global financial crisis gripped investors, with the market in oil powerhouse Saudi Arabia sinking by more than seven percent.

The biggest loss was reported in Egypt, where the key index plummeted by more than 16 percent to its lowest level in two years and some stocks shed a whopping 65 percent of their value.

“It is a catastrophe. It is clear that we will remain volatile and unpredictable as long as global markets remain impacted by the financial turmoil,” Saudi economist Abdulwahab Abu-Dahesh told AFP.

The Tadawul All-Shares Index (TASI) in Saudi Arabia — home to the Arab world’s biggest market — initially crashed more than 570 points, or 8.6 percent, but was trading 7.4 percent down at 6,230.43 points about an hour after opening.

The index had tumbled 9.81 percent on Monday.

“We are a part of this world and are impacted psychologically and practically by what is happening in global markets,” said Kuwaiti economist Ali al-Nimesh.

The slide in the Saudi market was also driven by the modest profits reported by several major banks, with two already announcing a drop for the first nine months of th