Gulf stocks tumbled Tuesday amid further volatility in financial markets across the globe. Dubai\'s benchmark index fell 1.95 per cent to a fresh five-month low of 1,444.29 and the Abu Dhabi Securities Exchange slipped 1.34 per cent to Dh2,577.76, its lowest close since March 8. Saudi Arabia\'s Tadawul All Share Index, the Arab world\'s most liquid stock market, ended at a five-month low and bourses in Qatar, Bahrain, Kuwait and Oman all closed down on yet another day of uncertainty. The sovereign-debt crisis in Europe, stalling global economic growth, growing fears over another global recession and the United States\' credit downgrade have all contributed to negative investor sentiment. Efforts by the European Central Bank to calm markets by buying Italian and Spanish bonds have done little to ease tensions. Article continues below \"We are at a stage where the volatile situation in global equities, rather than market fundamentals, is shaping investor sentiment,\" said Mohammad Ali Yasin, chief investment officer at CAPM Investment. \"The speed of the sell-off, however, is too fast and cannot continue at this pace. If a sense of calmness prevails across international markets it will be reflected on regional bourses. Consequences \"Markets are still pricing in the downgrade of the United States, which was announced late last Friday afternoon. The consequences of that decision are still being felt and the prospect of a double-dip recession is now more of a possibility than it was six months ago,\" he added. Ali Yasin says in order for sanity to be restored to the market investors need to start looking at the fundamentals of individual companies. He added, however, that he does not see that happening in the next few trading sessions. \"The US managed to avoid defaulting on its debts but it is cutting spending without increasing revenues, which means the economy remains stagnated rather than in recovery mode,\" he said. European markets were mixed with London\'s FTSE 100 up 19.41 points, or 0.38 per cent at 6.20pm UAE time after technically entering a bear market earlier in the day after falling more than 20 per cent from its closing high in February. Paris\' CAC was 0.65 per cent higher but Frankfurt\'s DAX was down 42.81 points, or 0.72 per cent. \"There is still some downside risk and I think global markets will fall a further 10 per cent. I just worry that people will be spoilt for choice [when they start to recover],\" said Gary Dugan, chief investment officer of private banking at Emirates NBD, the UAE\'s third largest bank by assets. According to Dugan, one of the key problems is that stock valuations do not count for anything at the moment as investors do not believe in their worthiness. He said people are more concerned about the prospect of companies being unable to pay dividends as a result of a collapse in corporate profits. Credible plans \"Over the long term, it is very important for investors that governments come up with credible plans to cut back their deficits,\" Dugan said. \"The US agreement [to raise the borrowing limit by $2.4 trillion] was a waste of time; it only bought around three months of time and we will be back in the same position by the end of the year. A significant drop in the price of oil does not help the situation in the GCC,\" he added.