Stock markets in the Gulf ended mixed on Tuesday as comments from Federal Reserve Chair Jerome Powell boosted bets for a September rate cut, although the a decline in oil prices weighed on investor sentiment.
Powell said on Monday the three U.S. inflation readings over the second quarter of this year “add somewhat to confidence” that the pace of price increases is returning to the Fed’s target in a sustainable fashion, remarks that suggest a turn to interest rate cuts may not be far off.
Markets have now fully priced in a quarter-point rate cut from the U.S. central bank in September, with a total easing of 68 basis points (bps) expected by the end of the year.
Monetary policy in the six-member Gulf Cooperation Council (GCC) is usually guided by the Fed’s decisions as most regional currencies are pegged to the U.S. dollar.
Saudi Arabia’s benchmark index advanced 1.1%, with aluminium products manufacturer Al Taiseer Group rising 2.3% and ACWA Power increasing 3.8%.
In Abu Dhabi, the index added 0.1%.
Major Gulf markets gain on firm oil prices, start to earnings season
Dubai’s main share index eased 0.1%, hit by a 2.6% fall in toll operator Salik Co.
The Qatari benchmark closed flat.
Crude prices – a catalyst for the Gulf’s financial markets – declined more than 1% on worries of a slowing Chinese economy crimping demand.
Outside the Gulf, Egypt’s blue-chip index dropped 0.4%, weighed down by a 6.8% decline in El Sewedy Electric Co.
The Central Bank of Egypt (CBE) is expected to keep its overnight interest rates steady when its monetary policy committee meets on Thursday as it works to bring down inflation, according to a poll of analysts.
======================================= SAUDI ARABIA rose 1.1% to 12,080 ABU DHABI up 0.1% to 9,156 DUBAI eased 0.1% to 4,110 QATAR was flat at 10,194 EGYPT lost 0.4% to 27,829 BAHRAIN was up 0.2% to 1,986 OMAN lost 0.1% to 4,690 KUWAIT fell 0.2% to 7,765 =======================================
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