Mideast Stocks: Gulf markets drop on weaker earnings; US inflation data in focus

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Stock markets in the Gulf slipped on Monday, led by the Saudi index, on weaker corporate results, while investors awaited U.S. inflation data to gauge the Federal Reserve's policy path for the rest of this year.

Saudi Arabia's benchmark stock index dropped 1.1% to 12,121, its lowest level in over there months, with all constituents posting losses, led by healthcare, IT and real estate stocks. Saudi National Bank, the kingdom's largest lender, fell 1.4% and Rabigh Refining and Petrochemical known as Petro Rabigh, declined 4.2%. Petro Rabigh, the hydrocarbon and petrochemicals producer, reported its quarterly loss widened to 1.37 billion riyals from 964 million riyals a year earlier.

Among other fallers, Emaar Economic City dropped 5.2% after the developer's first-quarter loss widened. Dubai's benchmark index dropped 0.9% with most sectors in the red. The blue-chip developer Emaar Properties slid 2.2 and Air Arabia declined 5.2%. The low-cost flyer Air Arabia posted a 22% decline in its quarterly profit on Monday.

The Qatari benchmark index was down after four consecutive sessions of gains and fell 0.2%, dragged down by a 1.3% drop in Qatar Islamic Bank and a 1.2% dip in Industries Qatar.

In Abu Dhabi, the benchmark index fell 0.4% with conglomerate Alpha Dhabi dropping 1.2% and First Abu Dhabi Bank, the UAE's largest lender, slipping 1.3%. Among other losers, Fertiglobe slid 1.5% after the MENA's largest nitrogen fertilizer maker, posted a 14% decrease in its first-quarter net profit.

"The market continued to trend toward its lows of the year and could remain exposed to the downside", said Joseph Dahrieh, Managing Principal at Tickmill.

Meanwhile, investors are awaiting the U.S. Consumer Price Index data due on Wednesday for clues to when the Federal Reserve will consider cutting interest rates.

Most Gulf currencies are pegged to the dollar, and any U.S. monetary policy change is usually mimicked by Saudi Arabia, the United Arab Emirates and Qatar.

Outside the Gulf, Egypt's blue-chip index was down 0.2%, with most sectors in negative territory. Eastern Company fell 2.2% and E-finance for Digital shed 2.3%. However, Fawry for Banking Technology climbed 4% after the e-payment provider reported a 134.8% surge in its quarterly net profit.