Muscat: The Oman stock market saw a volatile week amid global and regional uncertainties, according to an analyst. "While it was able to rebound to a certain extent this week from its long decline, recording a positive performance, the MSX 30 ended with a price correction on its last trading day, "Hani Abuagla Senior Market Analyst at XTB said.

As a result, the market could remain exposed to additional losses. Geopolitical tensions in the region still constitute a source of risk and could continue to weigh on sentiment, he added.

The value and volumes traded on the stock exchange have continued their decline for the second week in a row. Both values have been receding from their peak at the end of last month. "The market strongly benefited from the introduction of OQ Gas Networks during that period. However, trading volumes still remain higher than in previous months despite the decline," Hani Abuagla said.

The market was mainly supported by the performance of the financial sector which recorded a 1.10 percent increase this week. The services and industrial sectors fell, however, extending their multi-week decline, although losses were more limited than during previous weeks. The financial sector’s performance was led by the rise of Bank Dhofar and Ahli Bank. Bank Dhofar recorded one of the best performances on the market this week.

"Banks could remain a focus for investors as the economy continues to feel the weight of high interest rates. At the same time, changing expectations regarding monetary policy could affect stock performance and sentiment. As a result, attention could remain on the Federal Reserve and US economic data in particular after the latest US job market data," he said.

In this regard, traders reacted to the comments from the Federal Reserve’s governors this week and could monitor their upcoming interventions next week. "While expectations were leaning toward an end to the interest rate hike cycle, doubts returned after Jerome Powell’s comments. As a result, the exact start of interest rate cuts next year becomes more uncertain," Hani Abuagla said.

At the same time, oil prices continued to slide as attention turned to economic conditions on a global scale and as concerns about demand levels returned, adding some downside risks to the stock market.

“Additionally, oil-producing countries like Saudi Arabia could continue to extend production cuts in a bid to support prices. Geopolitical tensions in the Middle East could continue to represent a source of concern and could cause prices to rise if the conflict expands," he further added.

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