PERSIAN Gulf shares declined on concern a deepening global slowdown will turn into a recession, crimping profits at local real estate and finance companies, Bloomberg News reported.

Emaar Properties PJSC fell the most in more than a week. Saudi Telecom Co, the Arab world's largest phone company, dropped after reporting a decline in third-quarter profit. Gulf Finance House E.C., Bahrain's largest Islamic investment bank by market value, retreated as the lender said profit fell.

The Dubai Financial Market General Index lost 4.7 percent to 3,105.5 yesterday, while the Abu Dhabi Securities Exchange General Index retreated 4 percent. In Saudi Arabia, the Tadawul All Share Index fell 2 percent and the Bahrain All Share Index lost 3.7 percent.

"It's panic selling led by international funds which need liquidity to cover their losses," Bassam Ramahi, brokerage manager at Emirates Securities in Abu Dhabi, said in a telephone interview. "Those local investors who are following them will be the losers in the long run because you can't buy such big names so cheaply."

In the United States the Dow Jones Industrial Average lost 3.6 percent, while the Standard & Poor's 500 Index dropped 3.5 percent on concern the economic slump will hurt corporate earnings. More than US$10 trillion has been erased from the market value of shares worldwide this month. Reports on Friday showed the United Kingdom's economy contracted for the first time since 1992 and growth in South Korea was the slowest in four years.