Gulf stock markets closed higher on Tuesday on expectations of economic recovery in the world’s second largest economy, China, and smaller interest rate hikes from the U.S. Federal Reserve.
The Fed will end its tightening cycle after a 25-basis-point hike at each of its next two policy meetings and then likely hold interest rates steady for at least the rest of the year, according to most economists in a Reuters poll.
Most Gulf currencies are pegged to the U.S. dollar, while Saudi Arabia, the United Arab Emirates and Qatar usually mirror U.S. monetary policy changes.
The International Energy Agency (IEA) said on Wednesday that China’s lifting of COVID-19 restrictions should bring global demand to a record high this year. OPEC also forecast a rebound in Chinese demand.
The benchmark index in Saudi Arabia added 0.3%, lifted by gains in materials, financial and energy sector stocks, with oil giant Saudi Aramco continuing its gains since Monday, rising 0.6%. The world’s largest Islamic bank by market capitalization, Al Rajhi Bank, rose 0.8%.
In Abu Dhabi, the index rose 0.6%, ending its four session losing streak, with the country’s biggest lender First Abu Dhabi Bank surging 2.7% and real estate developer Aldar Properties rising 1.3%.
The developer said on Monday that the first phase Of ‘The Sustainable City – Yas Island’ was sold out within 24 hours, generating over 1 billion dirhams in sales.
Dubai’s benchmark index bounced back from two sessions of losses, rising 0.4%. The index was lifted by gains in financial and real estate stocks, with Dubai Islamic Bank up 2.2% and Mashreqbank climbing 3.1%, while real estate heavyweight Emaar properties added 0.3%.
The Qatari index rose 0.7%, extending its rally since Thursday, with almost all its constituent stocks gaining.
Qatar Islamic Bank continued its gains with a 2.3% rise and Qatar International Islamic Bank rose 1.7%.
Outside the Gulf, Egypt’s blue-chip index climbed 1.6%, continuing its rally since Wednesday.
“The Egyptian stock market continued to see a surge in investments from international traders”, said Daniel Takieddine, CEO MENA at BDSwiss.
“The index could maintain its uptrend as the country continues to secure financing deals from international institutions”.
Egypt has signed a $1.5 billion financing agreement with the International Islamic Trade Finance Corporation to fund its trading, including imports of energy products and essential commodities.
====================================== SAUDI ARABIA rose 0.3% to 10,796 QATAR rose 0.7% to 11,106 EGYPT added 1.6% to 16,440 BAHRAIN rose 0.2% at 1,929 OMAN added 0.2% to 4,786 KUWAIT rose 0.1% to 8,192 ABU DHABI added 0.6% to 10,222 DUBAI rose 0.4% to 3,364 ======================================