Mideast Stocks: Most Gulf Markets Retreat Ahead of US Economic Data

Most stock markets in the Gulf ended lower on Thursday, ahead of the U.S. economic data that could clarify the Federal Reserve's interest rate outlook. Investors are waiting for the release of the Personal Consumption Expenditures (PCE) Price Index, the preferred inflation measure of the U.S. Fed, scheduled for Friday.

The Fed's stance holds implications for Gulf economies, where most currencies are pegged to the U.S. dollar. Saudi Arabia's benchmark index dropped 0.7%, hit by a 1.1% fall in Al Rajhi Bank and a 2.2% decline in ACWA Power Company. Elsewhere, oil giant Saudi Aramco was down 0.2%.

Caution prevailed among investors ahead of the upcoming U.S. PCE inflation data. 

This report is critical for GCC markets, as U.S. inflationary trends and their impact on monetary policy heavily influence the region's monetary policies, said Joseph Dahrieh, Managing Principal at Tickmill.

"Furthermore, oil prices, despite being relatively stable this week, continue to pose a risk to the Saudi market due to their current low levels."

Oil prices — a catalyst for the Gulf's financial markets — fell after rising in the previous session, pressured by expectations of lower U.S. fuel demand at the end of the summer travel season and by the restart of Russian supply to Hungary and Slovakia through the Druzhba pipeline.

The Qatari index retreated 1%, with petrochemical maker Industries Qatar losing 2.2%. Dubai's main share index was down 0.7%, with blue-chip developer Emaar Properties falling 1.4%.

In Abu Dhabi, the index slipped 0.6%. Outside the Gulf, Egypt's blue-chip index edged 0.1% higher, helped by a 2.3% rise in Fawry for Banking Technology and Electronic Payment.

Egypt's Prime Minister Mostafa Madbouly on Thursday discussed activating a $7.5 billion "partnership package" with his Qatari counterpart, Egypt's cabinet said in a statement.

SAUDI ARABIA fell 0.7% to 10,732

Abu Dhabi down 0.6% to 10,119

Dubai dropped 0.7% to 6,084

QATAR declined 1% to 11,339

EGYPT added 0.1% to 35,727

BAHRAIN was up 0.2% to 1,929

OMAN gained 0.5% to 5,063

KUWAIT retreated 0.6% to 9,096