Bear Market Alert: Dubai Markets Slip Into a Bear Market as the West Asia War Enters Its Third Week

The Dubai Financial Market General Index (DFMGI) was trading around 6,607 levels prior to the escalation of geopolitical tensions in the Middle East, delivering one-year returns of about 10.86 per cent. During the same period, Indian equities remained under pressure, with the Nifty 50 index posting negative returns, indicating relatively stronger performance in Dubai markets before the recent developments.

However, the Dubai Financial Market General Index (DFMGI) has now fallen nearly 20 per cent, and if today’s losses hold, more than USD 43 billion in market value could be wiped out, following the escalation of conflict involving the United States, Iran, and Israel. The impact has also been reflected in Indian equities, where the Nifty 50 index has declined about 7.4 per cent since the conflict began, highlighting broader risk-off sentiment among investors.

Dubai Financial Market General Index Slips Into a Bear Market After Crashing Nearly 20% 

The Dubai Financial Market General Index (DFMGI) fell as much as 3.2 per cent on Monday, extending its losses to more than 20 per cent from its February peak, as geopolitical tensions in the Middle East intensified. 

If the benchmark closes at these levels, the index would officially enter bear market territory, as a decline of 20 per cent from a recent peak is commonly referred to as a bear grip. The sharp decline comes amid the ongoing conflict involving the United States, Iran, and Israel, which has triggered widespread investor caution across Gulf markets.

The market downturn follows a series of Iranian retaliatory strikes across the Gulf after coordinated US-Israel military operations against Iran. In recent weeks, Iran has launched hundreds of missiles and drones targeting infrastructure across the UAE, including areas near Dubai International Airport, Palm Jumeirah, and military bases such as Al Dhafra, with some debris also damaging buildings in Dubai’s financial districts. These attacks have heightened fears of economic disruption and regional instability, contributing to heavy selling pressure in Dubai equities.

Dubai Property Index Falls 20% in Five Days as Regional Conflict Escalates

Dubai’s Real Estate sector has also come under pressure, with the Dubai Financial Market Real Estate Index falling nearly 20 per cent in just five trading sessions, erasing most of its gains recorded earlier in the year. 

Disclaimer: The article is for informational purposes only and not investment advice.