The Dubai Stock market has been taking a beating for weeks, and news of firings at Arabtec (ARTC:UH), the United Arab Emirates’ largest listed builder, caused a new round of panic yesterday. Shares in the stock exchange fell 6.7 percent, to 4,009.01, leaving them down 25 percent from their May peak. It was the end of a long bull market: Since June 2012, shares in the emirate had climbed 250 percent.
Dubai has been looking like a property bubble for a little while now. The emirate has led consulting firm Knight Frank’s Global House Price Index for 12 months, and while growth has slowed in the past quarter, it still was up 27.7 percent for the year ended in March. Reuters reported that real estate deals in Dubai “jumped 38 percent in the first quarter to some 61 billion dirhams ($16.6 billion).”
If the symbol of the last boom, which ended brutally in 2008, was a network of islands built out of dredged sand in the shape of a world map—still unoccupied—the symbol of this one is a plan, announced in 2012, to build a complex that includes the world’s largest mall, along with 100 hotels (especially since a different mall in Dubai already holds the title of world’s biggest).
Source: Business week