Gulf Markets Navigate Tides: In the early hours of trading today, Gulf stock markets experienced a downturn, signaling a response to the already factored-in expectations of global monetary policy easing for the upcoming year. According to current conditions, investors do not expect a U.S. policy interest rate increase in December or next year. Market indicators indicate a 30% chance of easing in March, highlighting the effect of U.S. Federal Reserve decisions on GCC monetary policy. This is especially true since most regional currencies are connected to the dollar.
Saudi Arabia’s benchmark index witnessed a 0.3% drop, marking the end of a streak of four consecutive sessions of gains. Key players in the Saudi market, including ACWA Power and Saudi Electricity Co, experienced declines of 0.7% and 0.5%, respectively. Despite the positive announcement from Saudi Aramco about the discovery of two new natural gas fields in the Empty Quarter region, its stock slid by 0.6%.
Contrastingly, Dubai’s main share index remained relatively flat during this period. However, in Abu Dhabi, the index saw a minor dip of 0.1%, primarily influenced by a 0.4% decline in the stock of the country’s largest lender, First Abu Dhabi Bank.
Recent media reports have hinted at a tentative agreement between Israel, the U.S., and Hamas to release dozens of hostages in Gaza in exchange for a five-day pause in fighting. However, as of now, there has been no official confirmation of this development. The Qatari benchmark faced a 0.4% decline, influenced by a 1.1% fall in the stock of the Gulf’s largest lender, Qatar National Bank.
As global economic dynamics continue to evolve, the Gulf markets are navigating through a landscape shaped by anticipations of policy changes, with investors closely monitoring signals and adjusting their positions accordingly. The interplay of regional and international factors adds a layer of complexity to the market sentiment, requiring participants to stay vigilant and adaptable in response to emerging trends.