Gulf stock markets were mixed on Tuesday as investors awaited U.S. economic data that could influence the Federal Reserve’s rate cut decision. Saudi Arabia’s index gained while Qatar’s dipped.
Bollywood Fever: Major stock markets in the Gulf showed mixed performance in early trade on Tuesday as investors awaited crucial U.S. economic data that could influence how deeply the Federal Reserve might cut interest rates later this month.
Key economic indicators, including the U.S. ISM manufacturing survey due later today and jobs data expected on Friday, will be pivotal in determining whether the Fed opts for a 25 basis point or 50 basis point rate reduction at its September 18 meeting.Â
Economists predict that the ISM survey will show an improvement but still remain in contractionary territory at 47.5 in August.
Analysts are also forecasting a rise of 160,000 in non-farm payrolls (NFP) and a slight dip in the unemployment rate to 4.2%.
Monetary policy in the Gulf Cooperation Council (GCC) countries, including Saudi Arabia, typically mirrors the Fed’s decisions, given that most regional currencies are pegged to the U.S. dollar.
Saudi Arabia’s benchmark index edged up 0.1%, buoyed by a 0.7% increase in Al Rajhi Bank and a 4.9% surge in Savola Group.
A recent survey indicated that the pace of growth in Saudi Arabia’s non-oil sector recovered slightly in August, rebounding from the previous month’s more than two-year low, thanks to a pickup in new orders and job creation.
Dubai’s main share index also rose by 0.2%, supported by a 1.4% gain in blue-chip developer Emaar Properties.
Meanwhile, Abu Dhabi’s index eased slightly, down 0.1%.
The Qatari benchmark slipped by 0.1%, with Qatar National Bank, the Gulf’s largest lender, losing 0.6%.
Oil prices, a critical factor for the Gulf’s financial markets, declined as concerns over sluggish economic growth in China, the world’s largest crude importer, overshadowed the impact of the halt in production and exports from Libya.
As the Gulf markets remain sensitive to global economic developments, the upcoming U.S. data releases will likely play a significant role in shaping market movements and investor sentiment in the region.
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