Most stock markets in the Gulf were down in early trade on Wednesday as worries over higher interest rates by the US Federal Reserve continued to dent investor sentiment.

The Fed last week held its policy rate steady in a range of 5.25%-5.50%, but most policymakers signaled they believe one more interest-rate hike by the end of the year will likely be appropriate.

Monetary policy in the six-member Gulf Cooperation Council (GCC) is usually guided by Fed policy decisions because most regional currencies are pegged to the US dollar.

Dubai’s benchmark stock index was down 0.5% in early trade with Emaar Properties dropping 1% and Emirates Central Cooling Systems sliding 1.1%.

The emirate’s largest lender Emirates NBD slipped 0.6%.

In Abu Dhabi, the benchmark stock index fell 0.2%, weighed down by a 0.2% loss in conglomerate International Holding Company and 1.5% drop in Aldar Properties.

Major Gulf indexes subdued as rate outlook rattles investors

The UAE’s largest lender First Abu Dhabi Bank and Abu Dhabi Commercial Bank shed 0.4% and 0.8%, respectively.

In Qatar, the benchmark edged down 0.2% with Qatar Navigation falling 2.6% and Ooredoo QPSC dropping 1%.

Among the losers, Qatar Islamic Bank and Commercial Bank slipped 0.3% and 0.5%, respectively.

Saudi Arabia’s benchmark stock index was up 0.3%, helped by gains in most sectors with Sahara International Petrochemical Co surging 2.5% and Al Rajhi Bank gaining 0.6%.