|07 March, 2019

Sunday outlook: Global markets retreat on growth concerns, Gulf stocks drop sharply

Stock markets in the Middle East dropped sharply on Thursday, Egypt's blue-chip index outperformed the region

A man (R) cleans electronic boards showing the Japan's Nikkei average, the exchange rate between Japanese yen against the U.S. dollar and stock quotation outside a brokerage in Tokyo, Japan, April 6, 2016. REUTERS/Issei Kato - RTSDRFU

A man (R) cleans electronic boards showing the Japan's Nikkei average, the exchange rate between Japanese yen against the U.S. dollar and stock quotation outside a brokerage in Tokyo, Japan, April 6, 2016. REUTERS/Issei Kato - RTSDRFU

REUTERS/Issei Kato - RTSDRFU
  • Global markets retreat on weak data from the U.S. and China
  • Gulf stocks drop, Egypt’s EGX 30 gains 1.8 percent
  • Oil prices track equities lower
  • Dollar drops, gold prices add gains

Global markets

Stock markets around the world dropped on Friday on weak jobs data from the United States and weak Chinese export data.

U.S. employment growth almost stalled in February, with the economy creating only 20,000 jobs, adding to signs of a sharp slowdown in economic activity in the first quarter. The payroll gains reported by the Labor Department were the weakest since September 2017.

China data also showed that exports shrank 20.7 percent in February from a year earlier while imports fell 5.2 percent.

On Wall Street, the Dow Jones Industrial Average fell 22.99 points, or 0.09 percent, to 25,450.24, the S&P 500 lost 5.86 points, or 0.21 percent, to 2,743.07 and the Nasdaq Composite dropped 13.32 points, or 0.18 percent, to 7,408.14.

“People are worried about the jobs report and global growth in general and that is pushing markets lower,” Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management Company in Milwaukee, told Reuters.

The pan-European STOXX 600 index lost 0.89 percent and MSCI’s gauge of stocks across the globe shed 0.58 percent.

Middle East markets

Most markets in the Middle East dropped on Thursday.

Saudi Arabia's index fell 0.6 percent dragged lower by banking shares, with Al Rajhi Bank shedding 2 percent and the country's largest bank, National Commercial Bank, declining 2.1 percent.

The Dubai index fell 1.2 percent, as Emaar Properties dropped 3.1 percent and Emirates NBD fell 1.6 percent.

Abu Dhabi’s index fell 1.3 percent, with the United Arab Emirates' largest lender First Abu Dhabi Bank losing 2.3 percent and Agthia Group decreasing 3.4 percent.

The Qatari index dropped 1 percent to its lowest in five months as Qatar Electricity and Water dropped 5.4 percent and Doha Bank lost 4.6 percent.

Egypt’s blue-chip index EGX30 outperformed the region, rising 1.8 percent as its largest lender Commercial International Bank Egypt gained 2.5 percent and El Sewedy Electric jumped 5.6 percent.

Kuwait’s premier market index was mainly flat, while Oman’s index dropped 1 percent and Bahrain’s edged 0.1 percent lower.

Oil prices

Oil prices dropped sharply on Friday on global growth concerns.

Brent crude futures fell 56 cents, 0.8 percent, to settle at $65.74 a barrel. The international benchmark gained 1 percent for the week.

U.S. West Texas Intermediate (WTI) crude futures fell 59 cents, or 1 percent, to settle at $56.07 a barrel. WTI still ended 0.5 percent higher for the week, however.

“If we see equity markets continue to sink, it will eventually drag energy prices lower with it,” Brian LaRose, a technical analyst at United-ICAP, told Reuters.

Currencies

The dollar dropped on Friday on weak U.S. jobs data.

The dollar index, which measures the greenback against a basket of six major currencies, fell 0.31 percent.

Precious metals

Gold prices on a weaker dollar.

Spot gold rose 0.6 percent to $1,292.52 per ounce as of 1305 GMT, while U.S. gold futures gained 0.5 percent to $1,292.90.

(Reporting by Gerard Aoun; Editing by Mily Chakrabarty)

(gerard.aoun@refinitiv.com)


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