Most stock markets in the Gulf ended lower on Monday, with the Saudi index hitting its lowest in over 18 months, as OPEC+ kept output steady, while traders await the Federal Reserve meeting next week.
OPEC+ agreed to stick to its oil output targets at a meeting on Sunday as the oil markets struggle to assess the impact of a slowing Chinese economy on demand and a G7 price cap on Russian oil on supply.
Saudi Arabia's benchmark index tumbled 2.8%, touching its lowest since May 2021, dragged down by a 3.8% fall in Al Rajhi Bank and a 1.8% decrease in Retal Urban Development Co.
The Saudi bourse declined as concerns around oil markets and the global economy continue to affect traders' expectations, Fadi Reyad, Chief Market Analyst at CAPEX.com, said.
"However, the market could find some support as the local economy continues to see a strong performance."
Saudi Arabia's non-oil business activity expanded at the fastest rate in seven years in November, supported by a sharp rise in new orders and continued confidence in the growth outlook, a survey showed on Monday.
In Abu Dhabi, the index fell 0.8%. On Wednesday, Fed Chair Jerome Powell said the U.S. central bank could scale back the pace of its rate hikes "as soon as December," but cautioned the fight against inflation was far from over. Policymakers meet on Dec. 13 and 14. Most Gulf Cooperation Council countries (GCC) have their currencies pegged to the dollar and generally follow the Fed's policy moves, exposing the region to a direct impact from any monetary tightening by the Fed.
The Qatari index retreated 0.8%, with petrochemical maker Industries Qatar losing 3%. Dubai's main share index added 0.8%, extending gains for a second session, with blue-chip developer Emaar Properties rising 1.8%.
Outside the Gulf, Egypt's blue-chip index advanced 1.8%, with Commercial International Bank jumping 3.9%.
According to Reyad, the Egyptian market continued to see a surge with local investors maintaining high buying volumes.
- SAUDI ARABIA lost 2.8% to 10,419
- ABU DHABI fell 0.8% to 10,465
- DUBAI rose 0.8% to 3,352
- QATAR dropped 0.8% to 11,924
- EGYPT rose 1.8% to 14,328
- BAHRAIN eased 0.1% to 1,861
- OMAN rose 0.9% to 4,663
- KUWAIT declined 0.2% to 8,449
(Reporting by Ateeq Shariff in Bengaluru, Editing by Angus MacSwan)