The World Project off the coast of Dubai

US markets are closed today for Thanksgiving Day and in London, a technical hitch halted trading on the London Stock Exchange for three and a half hours.

The LSE began trading again at 2:00 pm after earlier announcing that "technical difficulties" had forced its temporary closure.

Markets have fallen sharply after Dubai World, the Gulf emirate's public investment company, carrying $59 billion of liabilities, shocked markets on Wednesday by seeking to delay repayment on much of its debt.

World stock markets fell sharply today on the news.

The local newspaper, Khaleej Times, said the request for what the government called a “standstill” in financing payments by property developer Nakheel and other member companies of heavily indebted Dubai World is the first step in a restructuring of the group’s finances.

The standstill is to include a $3.52 billion payment that Nakheel is scheduled to repay in December, a spokeswoman for the Department of Finance told Khaleej Times.

The surprise announcement followed months of speculation and uncertainty about the ability of Nakheel in particular to service its debts. Nakheel has suffered severely from the recent collapse in real estate prices in Dubai, and creditors view its December sukuk payment as a bellwether for the creditworthiness of companies owned by or affiliated with the Dubai government.

The newspaper said it was impossible to know how local markets would react to the restructuring plans. However, Dr. Eckart Woertz, programme manager for economics at the Gulf Research Centre in Dubai, said he foresaw that a request for a debt moratorium would adversely affect Dubai’s reputation in international financial markets.

“It will likely destroy confidence,” Woertz said.

In its July filing, Nakheel said that Dubai World’s consolidated liabilities at the end of December amounted to Dh217.8 billion, or about $59.1 billion, compared to total assets at that time of Dh365.8 billion.

Annual Irish manufacturing prices down 5.2% in October

The CSO reported today that monthly factory gate prices decreased by 0.6% in October 2009. This compares to an increase of 1.2% recorded for October 2008. As a result, the annual percentage change showed a decrease of 5.2% in October 2009, compared with an annual decrease of 3.5% in September 2009.

In the month, the price index for export sales decreased by 0.8% while the index for home sales decreased by 0.4%. In the year there was a decrease in the price index for export sales of 6.0% (this can be influenced by currency fluctuations) and a decrease of 2.1% in respect of the price index for home sales.

UK retail sales rose at their fastest pace in two years in November, according to a CBI survey Thursday. "We're not really getting a message from this that is unusual or different from what we've been expecting for the last 6 months," Chris Tinker from ICAP said, adding that obviously the holiday period is very important for retailers.