• Global markets retreated on trade tensions
  • Saudi Arabia’s index drops on Thursday, UAE and Qatari stocks edge higher
  • Oil prices drop on trade worries, losses limited by reduced supply
  • Dollar and gold prices add gains

Global markets

Stocks around the globe mainly dropped on Friday as trade concerns weighed on sentiment after the United States and Canada failed to reach a deal to update the North American Free Trade Agreement (NAFTA) and as trade tensions between the U.S. and China kept investors on edge.

On Wall Street, the Dow Jones Industrial Average fell 22.1 points, or 0.09 percent, to 25,964.82, the S&P 500 gained 0.39 points, or 0.01 percent, to 2,901.52 and the Nasdaq Composite added 21.17 points, or 0.26 percent, to 8,109.54.

“It’s very hard to see a decisive resuscitation of risk appetite until these tensions are resolved,” Paul O’Connor, head of the multi-asset team at Janus Henderson Investors, told Reuters.

“We have learned to under-react to some of the individual headlines because if you try to extrapolate from any of them you could find yourself in big trouble.”

The MSCI All-Country World Index, which measures stocks in 47 countries, lost 0.34 percent on Friday.

Middle East markets

Saudi Arabia’s index dropped 0.9 percent on Thursday as Saudi Basic Industries (SABIC) fell 1.1 percent and Al Rajhi Bank declined 1 percent.

The Saudi index has gained about 10 percent so far this year, boosted by inflows of foreign funds in anticipation of Riyadh joining emerging market indices next year. Recent exchange data indicates those inflows have slowed, but not halted, as stock valuations have risen.

Dubai’s index edged up 0.3 percent as Arabtec added 1.6 percent and Emirates NBD rose 0.5 percent.

Abu Dhabi’s index added 0.5 percent as First Abu Dhabi Bank was up 0.7 percent and Abu Dhabi Islamic Bank 2.3 percent higher.

Qatar’s index gained 0.5 percent with Qatar National Bank rising 1.7 percent and Qatar Islamic Bank adding 2.4 percent.

Egypt’s index gained 1.1 percent. Commercial Bank International Egypt climbed 2.2 percent and Madinet Nasr for Housing surged 5.1 percent.

Kuwait’s index edged 0.1 percent lower, Bahrain’s index dropped 0.3 percent and Oman’s index fell 0.3 percent.

Oil prices

Oil prices retreated on Friday as trade tensions weighed on prices. Declines were limited by falling Venezuelan output and the anticipation of lower Iranian output ahead of U.S. sanctions.

Brent crude oil fell 35 cents to settle at $77.42 a barrel.

U.S. crude slipped 45 cents to settle at $69.80.

For August, Brent closed the month 4.3 percent higher while U.S. crude gained 1.5 percent.

Currencies

The dollar gained on Friday after reports that the United States and Canada failed to reach a deal to update the North American Free Trade Agreement.

The dollar was up about 0.6 percent amid trade tensions.

“The trade-positive news in the beginning of the week with the U.S.-Mexico deal has turned, and has become trade-negative,” Alfonso Esparza, currency strategist at OANDA in Toronto, told Reuters.

“Now we’re seeing resistance on the Canada front with respect to NAFTA. Negotiations have concluded, but nothing has been decided so there’s a little bit of uncertainty. That has created a risk-averse environment, which has benefited the dollar.”

Precious metals

Gold prices edged up on Friday despite a strong dollar as investors demand for risky assets dampened as they sought safety in havens like gold due to global trade tensions.

Spot gold gained 0.1 percent at $1,200.70 per ounce by 1:34 p.m. EDT (1734 GMT) for a rise of about 4 percent from the 19-month low of $1,159.96 hit on August 16.

U.S. gold futures for December delivery settled up $1.70, or 0.1 percent, at $1,206.70 per ounce.

 

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(Writing by Gerard Aoun; Editing by Michael Fahy)

(gerard.aoun@thomsonreuters.com)

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