Major stock markets in the Gulf rose in early trade on Tuesday ahead of a key U.S. inflation data that could affect the size of the Federal Reserve’s interest rate cut next week.
Investors remained focused on the U.S. consumer price index report, due Wednesday, which would likely provide clarity on whether the Fed could deliver an outsized 50-basis-point cut when it meets on Sept. 17-18.
Market pricing points to about 110 bps of cuts expected from the U.S. central bank this year.
Monetary policy in the six-member Gulf Cooperation Council (GCC), including the UAE, is usually guided by the Fed’s policy decisions because most currencies in the region are pegged to the dollar.
Most Gulf markets retreat as Fed uncertainty persists
Saudi Arabia’s benchmark index gained 0.3%, with Al Taiseer Group rising 0.7% and Al Rajhi Bank up 1.6%.
Dubai’s main share index added 0.5%, led by a 3.1% jump in toll operator Salik Company.
In Abu Dhabi, the index was up 0.3%.
The United Arab Emirates’ economy grew 3.4% in the first quarter of 2024 compared with the same period the previous year, according to preliminary government estimates reported by the state news agency WAM on Monday.
The Qatari benchmark increased 0.6%, with the Gulf’s biggest lender Qatar National Bank advancing 1.7%.
Among other gainers, Vodafone Qatar rose 0.2%. The telecom firm signed a 5-year partnership agreement with Microsoft.
Comments