Most stock markets in the Gulf ended down on Tuesday, with the Saudi index extending its losses to a fifth session, on concerns over surging COVID-19 cases in China.
Oil prices, a key catalyst for the Gulf’s financial markets, extended losses, sliding to a two-week low with Brent futures dropping $5.95, or 5.6%, to $100.95 a barrel by 0747 GMT.
Saudi Arabia’s benchmark index dropped 0.7%, hit by a 6.9% decline in Saudi Arabian Mining Co.
Oil giant Saudi Aramco fell 1.4% to 38.75 riyals. US oilfield services company Schlumberger said it has received a contract from Aramco for integrated drilling and well construction services in a gas drilling project.
“Gulf Cooperation Council stock markets fell in tandem with other world markets as risks accumulate beside those resulting from the Ukrainian conflict,” said Daniel Takieddine, chief executive officer of MENA BDSwiss.
China posted a steep jump in daily COVID-19 infections on Tuesday, with new cases more than doubling from a day earlier to hit a two-year high, raising concerns about the rising economic costs of the country’s tough containment measures.
“China has also become a source of concern as Russia looks to it for help which could expose it to sanctions as well,” adds Takieddine.
The Qatari index dropped the most, with a 1.7% fall. Qatar Electricity And Water Co fell 8.5%, its biggest percentage fall since March 2020, as shareholders of the utility approved the 40% share capital acquisition of Nebras Power.
Abu Dhabi’s index dipped 0.7% and Dubai’s main stock index lost as much as 1.4%.
Amlak Finance finished 6.3% lower, extending losses to a fifth straight session. On Friday, the UAE-based Islamic lender reported a year-end accumulated losses-to-capital ratio of 87.6%.
Outside the Gulf, Egypt’s blue-chip index reversed early losses to close flat.
“The decrease in oil prices comes as an additional negative factor as Egpyt could see a decrease in revenue while agricultural products continue to surge,” says Takieddine.
SAUDI ARABIA down 0.7% to 12,408
ABU DHABI fell 0.7% to 9,480
DUBAI down 1.4% to 3,305
QATAR lost 1.7% to 13,237
EGYPT was flat at 10,423
BAHRAIN slipped 1.8% to 1,969
OMAN rose 0.4% to 4,343
KUWAIT dipped 0.5% to 8,608
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