Most Gulf markets in black as Trump holds off Iran strike

Most stock markets in the Gulf ended higher on Monday, with the Dubai bourse outperforming the region, after U.S. President Donald Trump said he had paused a potential strike on Iran, raising hopes for a deal and reopening of the Strait of Hormuz.

The gains came despite Iran saying on Monday that no talks with the United States were under way and that no meetings were planned, contradicting Trump’s claim that discussions would take place later that day — a reason he cited for calling off planned attacks.

Dubai’s main share index advanced 1.4%, its biggest single-day gain since June 18, with top lender Emirates NBD jumping 3.3% and sharia-compliant lender Dubai Islamic Bank finishing 2.9% higher.

In Abu Dhabi, the index added 0.3%, led by a 9.2% surge in Alpha Dhabi Holding following a steep rise in first-half profit.

Gulf equities are gaining support from resilient bank earnings, strong non-oil growth, healthy oil prices, and hopes of easier U.S. monetary policy. However, it is still too early to call this a sustained bull market, said Rania Gule, senior market analyst at XS.com - MENA.

A lasting uptrend will depend on continued foreign inflows, solid earnings, stronger volumes and geopolitical stability, Gule said, otherwise the rally may prove short-lived.

Saudi Arabia’s benchmark index rebounded from early losses to close 1.1% higher, led by a 2% gain in oil major Saudi Aramco. Jabal Omar Development surged 8.5% after reporting strong second-quarter earnings a day earlier.

Two Saudi oil tankers transited the Bab el-Mandeb Strait from the Red Sea over the weekend, while traffic through the Strait of Hormuz slowed amid reports of vessel attacks, shipping data showed on Monday.

According to Daniel Takieddine, co-founder and CEO, Sky Links Capital Group, any positive shipping updates at Bab el-Mandeb and the Strait of Hormuz could offset fears of supply disruptions. The second-quarter corporate earnings season also underpins market sentiment as companies continue to record positive results.

Brent crude futures fell $5.04, or 5.73%, to $82.89 by 1218 GMT on Monday.

The Qatari index closed 0.8% higher, with the Gulf’s biggest lender Qatar National Bank gaining 1.5%.

Outside the Gulf, Egypt’s blue-chip index fell 0.4%.

Separately, an earthquake measuring 5.6 in magnitude struck 38 km (24 miles) north of the Egyptian city of Suez just after 3:00 a.m, Egypt’s National Research Institute of Astronomy and Geophysics said.

The institute said it had received no reports of casualties or damage to property.