The Middle East and North Africa markets have lost nearly $90 billion year-to-date, mostly due to rising tension in Libya, according to analysts at Kuwait Financial Center (Markaz), who expect the upward pressure on oil prices could seriously threaten the global economic recovery.
If Algeria and Saudi Arabia get caught up in the current political unrest, the threat could be heightened, Markaz added.
"The rapid, and troubling, escalation of hostilities in Libya, bringing with it the eyes of the world, has spooked markets. The 11 main Arab bourses have lost nearly $90 billion from January 25th to date," Markaz said in a note to clients.
Markaz said world markets had rallied in early February with positive economic news, before being hit by tension in the Middle East and the sharp spike in oil prices.
However, all Gulf Cooperation Council markets, except Abu Dhabi, were in the red due to the political unrest and disappointing corporate performance, Markaz said.
Road blocks to Etisalat’s $12 billion takeover bid of Kuwait’s Zain have also negatively affected market sentiment, Markaz added.