MOST Gulf markets closed higher yesterday as easing energy disruption fears and tempered expectations of an immediate Federal Reserve rate hike bolstered sentiment, while the Middle East war continued to simmer.
Cooling US jobs data and sharp downward payroll revisions slashed the odds of a Fed rate hike this month from 64 per cent to under 20pc, according to the CME FedWatch tool, though traders still anticipate a December move.
Gulf markets tend to track shifts in US monetary policy expectations as most regional currencies are pegged to the dollar. Middle East crude exports surpassed levels seen before the start of the US-Iran war on four days in late September, shipping data showed yesterday, defying continued vessel attacks in the Strait of Hormuz. Release of oil stocks by the Group of Seven nations further boosted supplies.
Dubai’s main share index added 0.1pc, with utility firm Dubai Electricity and Water Authority advancing 3.8pc. In Abu Dhabi, the index was up 0.4pc. The UAE’s non-oil private sector saw strong growth in September, supported by firmer demand, which strengthened pricing power of businesses and led to the steepest increase in selling prices in more than 15 years, according to a survey released yesterday.
The Qatari index advanced 1.1pc, led by a 1.2pc increase in the Gulf’s biggest lender Qatar National Bank. Milad Azar, market analyst at XTB Mena, said most GCC equity markets remained resilient despite ongoing geopolitical uncertainty and stalled US-Iran negotiations. He added that continued shipping disruptions in the Strait of Hormuz are still weighing on investor sentiment, as markets await tangible diplomatic progress to ease tensions. Nevertheless, strong domestic fundamentals continue to support regional markets.
Bucking the trend, Saudi Arabia’s benchmark index fell 0.3pc, hit by a 1.5pc slide in Al Rajhi Bank .
Outside the Gulf, Egypt’s blue-chip index dropped 0.7pc, with Commercial International Bank losing 0.7pc.
Egypt’s non-oil private sector contracted more sharply in September, with output and new orders hit hard by inflation and geopolitical turmoil, a business survey showed yesterday.
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