Mideast Stocks: Major Gulf Bourses Gain on US Rate Cut Bets

Major stock markets in the Gulf rose in early trade on Wednesday after U.S. Federal Reserve Chair Jerome Powell's dovish comments improved global investor sentiment, even as soft oil prices amid a supply surplus and U.S.-China trade tensions capped gains.

Powell signaled potential additional rate cuts on Tuesday and said the end of the central bank's long-running effort to shrink the size of its holdings may be coming into view.

His comments, viewed by some as dovish, lifted global markets slightly and reinforced expectations of more easing this year, with roughly 48 basis points worth of cuts priced in by December.

The Fed's stance holds implications for Gulf economies, where most currencies are pegged to the U.S. dollar, making it an anchor for regional monetary stability.

Saudi Arabia's benchmark index gained 0.2%, led by a 0.6% gain in oil giant Saudi Aramco and a 1.5% increase in ACWA Power Company.

The International Monetary Fund upgraded its 2025 economic growth forecast for Saudi Arabia on Tuesday due to a faster-than-expected unwinding of oil production cuts in the world's top crude exporter.

Dubai's main share index edged 0.1% higher, helped by a 0.7% rise in blue-chip developer Emaar Properties .

In Abu Dhabi, the index added 0.1%.

Oil prices - a catalyst for the Gulf's financial markets - fell, extending losses from the previous session, as investors weighed the International Energy Agency's warning of a supply surplus in 2026 and U.S.-China trade tensions that could curtail demand.

The Qatari index added 0.3%, with Islamic lender Al Rayan Bank gaining 2.1%.