Mideast Stocks: Most Gulf equities retreat on investor caution ahead of US-Iran talks

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Gulf markets reversed early trends by the closing bell on Tuesday, as investors adopted a cautious stance in a volatile session ahead of ⁠a third round of US-Iran nuclear talks scheduled for Thursday.

Saudi Arabia's benchmark stock index retreated ‌0.7% after a modest recovery in the prior session, as the kingdom's budget deficit widened quarter-on-quarter due to higher expenditures.

Losses were broad-based, with Saudi Telecom Company down 2.1% and Saudi Aramco shedding 0.5%. Reuters reported, citing trade sources, that energy giant Aramco has sold several shipments of ultra-light crude oil from its $100 billion Jafurah gas plant to U.S. majors and an Indian refiner, ahead of its first export later this month. The market is well-positioned to build ⁠on its strong fundamentals as external pressures ease, said Antoine Nadaf, Country Manager at Givtrade.

In Dubai, the main stock index declined 0.6%, following a nearly 2% surge in the prior session. Weighed down by banking stocks, Emirates NBD Bank saw its sharpest one-day drop in nearly three months, tumbling over 4%, while Dubai Islamic Bank retreated 1.6%.

Abu ‌Dhabi's stock index ⁠ended flat, holding its ⁠ground after rebounding in the prior session from a two-day sell-off at record highs. ADNOC Gas edged down 0.3%, while Abu Dhabi Commercial Bank gained 0.3%, continuing Monday's advance.

Nadaf noted that Abu Dhabi ‌market retains upside potential, backed by robust fourth-quarter results and solid ⁠economic projections, though oil price volatility remains a key watchpoint.

Oil prices, a key catalyst to gulf markets, hovered near seven-month highs, with traders assessing risks to supply from any military escalation as another round of U.S.-Iran nuclear talks loomed.

Qatar's stock index added 0.1%, driven by banking shares. Qatar National Bank, the region's largest lender, gained 0.5%, extending momentum from its best daily performance since mid-October in the previous session.

U.S.-based private credit investment firm 5C Investment Partners announced a strategic partnership with the Qatar Investment Authority to expand its direct lending platform.

Outside the Gulf, Egypt's blue-chip index slipped 0.9% with a sell-off led by ‌banking stocks. Commercial International Bank, the country's largest private lender, fell 1.3%. Talaat Moustafa ⁠Group declined 1.6%, reversing gains from the previous session, after the real estate developer reported a 43% rise in full-year profits on Monday and secured a promotion to the mid cap segment of the FTSE Russell Global Equity Index Series.

The International Monetary Fund said its board would meet on February 25 to review ‌Egypt's Extended Fund Facility programme, a move that could unlock $2.3 billion in disbursements.