DUBAI: Most Gulf stock markets fell on Monday as stalled US-Iran diplomacy revived fears of a prolonged conflict, while reduced traffic through the Strait of Hormuz added to concerns over energy supplies and trade flows.
Tensions remained high after Iran on Saturday urged Washington to “accept defeat,” while US President Donald Trump called Tehran “very evil” and urged Americans to prepare for sustained high fuel prices.
With no meaningful progress towards peace talks, shipping through the strategic waterway remained severely disrupted. Trump also said he would soon declare the Strait of Hormuz a US territory.
Saudi Arabia’s benchmark stock index eased 0.1 percent, dragged down by a 0.5 percent fall in Al Rajhi Bank and a 0.8 percent decline in oil major Saudi Aramco.
The kingdom’s Civil Defense said on Sunday that the danger in Jazan province had passed, according to a post on X. It had earlier issued an alert warning residents of a potential danger in the area.
In Qatar, the benchmark stock index declined 1.5 percent, with almost all constituents trading in negative territory. Qatar Islamic Bank retreated 2.3 percent.
Shipping activity through the strait slowed markedly over the weekend in the wake of last week’s tanker attacks. Kpler ship-tracking data showed that only five commodity vessels transited the waterway on Saturday, while none were recorded on Sunday, compared with 31 during the previous weekend.
Dubai’s main share index fell 0.5 percent, with top lender Emirates NBD losing 1.7 percent.
The lack of diplomatic progress and persistent regional uncertainty kept investors on edge. Continued shipping disruptions and security concerns are likely to pressure sentiment, though resilient domestic fundamentals and a solid earnings season are providing support, said Joseph Dahrieh, managing Director at Tickmill.
Markets are likely to remain range-bound and sensitive to regional headlines. Progress on diplomacy or smoother shipping flows could lift sentiment, while strong local fundamentals should limit downside.
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