Atiq Sharif
(Reuters) – Most Gulf stock markets closed lower on Tuesday after stronger-than-expected U.S. retail sales bolstered views the Federal Reserve may be in no rush to cut interest rates this year.
Data last week already showed U.S. consumer prices rose more than expected in March as Americans paid more for gas and rent. Leading financial markets expect the Fed to delay rate cuts until September.
Most Gulf currencies are pegged to the dollar, and any change in monetary policy in the United States is usually copied by Saudi Arabia, the United Arab Emirates and Qatar.
Saudi Arabia’s benchmark index fell 1.6%, with most of its constituents in negative territory, including Al Rajhi Bank, which fell 2.9%.
Other losers include oil giant Saudi Aramco (TADAWUL:) fell 1.3%.
Investors remained cautious about Israel’s response to Iranian drone and missile attacks over the weekend, as international pressure for restraint grew amid fears of an escalation in the Middle East.
Dubai’s main share index lost 1.4% as leading lender Emaar Properties fell 1.7%.
The Dubai bourse broke the support level it held last month, impacted by both geopolitical tensions and rising inflation pressures in the United States. The market could continue its downward trajectory if such pressure continues, said Joseph Dariye, managing director at Tickmill.
“However, the upcoming Spinneys IPO could have a positive impact on the overall market sentiment,” he added.
The franchisee of supermarket chain Spinneys has announced plans for an initial public offering (IPO) on the Dubai bourse and said on Tuesday it plans to expand its operations in Saudi Arabia this year.
In Abu Dhabi, the index fell 0.6%.
The Qatar index lost 0.7% as shares of petrochemical producer Industries Qatar fell 1.2%.
Oil prices, a catalyst for Gulf financial markets, fell but remained around $90 a barrel as investors weighed how Middle East supplies could be affected if the geopolitical situation deteriorates further.
Outside the Gulf, Egypt’s blue-chip index fell 0.7%, with Talaat Mostafa Holding shedding 2.6%.
SAUDI ARABIA fell 1.6% to 12,500.
ABU DHABI fell 0.6% to 9,194
DUBAI fell 1.4% to 4,184.
QATAR fell 0.7% to 9,853.
EGYPT lost 0.7% to 29,401.
BAHRAIN added 0.1% to 2,042.
OMAN shares rose 0.2% to 4,738.
KUWAIT fell 2.8% to 7,569.