Press Trust of India / Dubai/London Dec 14, 2009, 16:51 IST
Shares in the United Arab Emirates surged today after neighbouring Abu Dhabi came up with a $10 billion assistance for the Dubai government to tide over the state's debt crisis.
The Dubai stock market's benchmark DFM Index soared over 10 per cent to 1,871.20 points, reflecting bolstered investor sentiment and the scrip of real estate developer Emaar Properties PJSC jumped 15 per cent.
Strong trends were seen in the Abu Dhabi Securities Exchange too, with their General Index shooting up 7.76 per cent to 2,816.66 points.
Stocks in Kuwait climbed nearly one per cent and the key Market Index was at 6,908.2 points.
The Dubai government would partly utilise the $10 billion funds, to bailout the debt-laden Dubai World and also meet nearly $4 billion bonds obligation of the state-owned conglomerate's subsidiary Nakheel, which are due today.
With these funds, Nakheel would be able to avert a default that would have further weakened global markets, which are slowly coming out of the financial crisis.
Last month, Dubai World sought additional time to repay debts worth $59 billion, a move which sent world markets into a tizzy.
Boosted by the positive news from the Gulf, most of the Asian and European shares were trading in the green.
In Asia, Hong Kong's benchmark Hang Seng index jumped about one per cent to 22,085.75 points. Many other markets in the region either rose marginally or closed flat.
South Korea's Kospi index was slightly up at 1,664.77 points. Nikkei 225, Japan's key index, was unchanged at 10,105.68 points and Singaporean Straits Times Index ended flat at 2,799.54 points.
Markets in Europe witnessed a strong opening and all the three major indices -- London Stock Exchange's FTSE 100, Germany's Dax and France's Cac 40 -- gained one per cent.
FTSE 100 rose to 5,314.98 points while Dax increased to 5,816.32 points. Cac 40 inched up to 3,832.06 points.
World markets would be closely watching the US Federal Reserve's comments later this week on the nation's economy and its approach to interest rates.
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