Most stock markets in the Gulf ended higher on Monday as investors grew more optimistic about a September U.S. rate cut, ahead of a busy week that will see the release of a key inflation report and Federal Reserve Chair Jerome Powell’s testimony.
A slowdown in U.S. jobs on Friday added further to the case for a Fed rate cut in September.
U.S. inflation is easing and the job market has returned to the “tight but not overheated” situation seen before the COVID-19 pandemic threw the U.S. economy into disarray, the Fed said on Friday.
Saudi Arabia’s benchmark index gained 0.3%, with Al Rajhi Bank rising 0.6% and Saudi Awwal Bank advancing 3.2%.
Fed Chair Jerome Powell will have a chance to offer his outlook when he appears before Congress on Tuesday and Wednesday, while several other Fed officials are speaking this week.
Monetary policy in the six-member Gulf Cooperation Council (GCC) is usually guided by the Fed’s decisions as most regional currencies are pegged to the U.S. dollar.
Dubai’s main share index added 0.3%, led by a gain in top lender Emirates NBD and a 2% increase in diversified investment group Dubai Investments.
In Qatar, the index closed 0.3% higher, with Qatar Islamic Bank rising 0.7%, while Qatar National Bank (QNB) was up 0.3%.
QNB, the Gulf’s biggest lender, beat analyst estimates on Monday after reporting its net profit rose 10.8% in the second quarter from a year earlier.
The Abu Dhabi index was down 0.1%.
Crude prices - a key catalyst for the Gulf’s financial markets - edged lower after gaining for four weeks as supply disruption worries eased on hopes of a ceasefire deal in Gaza, but the potential impact of Hurricane Beryl on supplies kept the slide in check.
Outside the Gulf, Egypt’s blue-chip index fell 0.7%, weighed down by a 1.3% drop in Commercial International Bank.
======================================= SAUDI ARABIA rose 1.1% to 9,473 ABU DHABI fell 0.1% to 9,133 DUBAI gained 0.3% to 4,082 QATAR added 0.3% to 10,157 EGYPT lost 1.1% to 11,337 BAHRAIN was up 0.1% to 2,005 OMAN was flat at 4,687 KUWAIT advanced 1.2% to 7,692 =======================================