Dubai's Emaar Properties fell 4.25 percent in early trade, dragging on the index as investors worry about the health of the emirate's economy following negative news from lenders and the government.

The benchmark declines 2.18 percent to 2,008 points. Islamic lender Amlak drops 4.63 percent. The bank said on Wednesday it had suspended new mortgage loans because of the credit crisis.

In Abu Dhabi, the index fell 0.75 percent to 2,859 points, led lower by Etisalat, which declined 2.69 percent. -Reuters