Stocks in the Persian Gulf state of Dubai fell more than 7% Monday, the first day of trading after the state’s debt problems shocked financial markets around the world last week.
The index for the Dubai Financial Market, the emirate’s primary stock exchange, ended the day down 7.3%.
The announcement last week raised fears about the overall health of the global financial system and made investors nervous across the globe. Concerns were eased slightly on Sunday after the United Arab Emirates (UAE) offerd Dubai some support.
The UAE, a federation of seven emirates announced that it will establish an emergency liquidity facility to help prevent Dubai from defaulting on its debts.
Fellow emirate Abu Dhabi also announced plans to provide aid to some selected Dubai banks and financial establishments.
Major indexes in Europe remained under pressure this afternoon, with shares in London, Paris and Frankfurt down about 1% in afternoon trading.