With the beginning of the political crisis in Egypt most of the financial markets in the GCC and North Africa faced a sharp decline in their indices. According to a fresh report published in Kuwait, during the last five days of January the Arab financial markets lost about US$49 billion, say a decline of 5% to reach a total capitalization of US$ 942 billion at the end of January 31, 2011.
The bigeest decline was posted by the Egyptian stock exchange, which since the beginning of this year, lost about $ 15 billion to reach US$70 billion at the end of January 2011. This heavy loss came mostly during the trading sessions on 26 and 27 of January, when the market value of the Egyptian stock exchange lost US$12.5 billion. These were the heaviest losses of the Egyptian Stock Exchange since October 2008. It is worth mentioning that since then the Egyptian stock exchange remained closed.
Generally speaking, the Arab financial markets were mostly profitable until January 25, 2011. Their market value increased by US$ 12.3 billion to hit US$ 991 billion with the exception of the Egyptian Stock Exchange and the Tunis Stock Exchange, which lost 9.42% or the equivalent of U.S. $ 966 million as a result of the political events. In addition, the Abu Dhabi Stock Exchange has lost about $ 1.2 billion since the beginning of the year to January 25, 2011.
However, during the last week of January the losses extended to other markets as a result of fear and panic among investors.
As mentioned, Arab markets lost during the last week of January US$ 48.8 billion (5% of the total market value). A loss of: US$ 32 billion was posted in the GCC markets with the exception of Bahrain Stock Exchange by market, which saw its value rising by US $ 311 million during the said period.
The Saudi stock market, the largest financial market in the Arab world, was responsible for 63% of the total market loss in the Gulf. The market value of the Saudi stock market fell by 5.6% or the equivalent of US$ 20.3 billion during the last week of January 2011. Qatar's stock market has lost 3.4% or the equivalent of US$ 4.3 billion during the last week of January 2011. The Kuwait Stock Exchange, Dubai and Abu Dhabi have seen a total decline of US$ 7.4 billion. Meanwhile, other Arab markets have lost about $ 17 billion during the same period.