DUBAI: Most Gulf stock markets were subdued on Wednesday as renewed geopolitical tensions between the US and Iran weighed on sentiment, with Dubai’s exchange posting the biggest decline.
US President Donald Trump said on Tuesday he was considering sending a second aircraft carrier to the Middle East, even as Washington and Tehran prepare to resume negotiations aimed at averting a new conflict.
Trump also said he thinks that Iran wants to make a deal with the United States on its nuclear and ballistic missile programs, and it would be “foolish” if they did not.
Saudi Arabia’s benchmark index dropped 0.4 percent, hit by a 0.9 percent fall in the country’s biggest lender Saudi National Bank .
However, Mobile Telecommunications Co jumped more than 5 percent, following an increase in annual profit.
Despite the overall bearish sentiment, underlying fundamentals remain supportive, with fourth-quarter earnings showing strong performances, said Joseph Dahrieh, managing director at Tickmill. He added that with the broader earnings season proving largely positive, the Saudi market could still stage a recovery if external geopolitical pressures ease.
Dubai’s main share index retreated 1.3 percent, weighed by a 8.6 percent plunge in Dubai Islamic Bank after the sharia-compliant lender posted a decline in annual profit.
In Abu Dhabi, the index concluded flat.
Any potential US military strike on Iran has sparked fears that regional countries would face the bulk of Tehran’s retaliation. In mid-January, Saudi Arabia, Qatar, Oman and Egypt cautioned Washington against launching any such attack.
The Qatari index also finished flat.
Qatar’s Emir Sheikh Tamim bin Hamad al-Thani and Trump discussed in a phone call efforts for regional de-escalation and stability, the Emiri Diwan said on Wednesday.
Outside the Gulf, Egypt’s blue-chip index declined 1.3 percent - snapping a six-day winning streak - with Commercial International Bank losing 1.9 percent.
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