As concerns over a banking crisis subsided, the majority of stock markets in the Gulf rose in early trade on Wednesday, tracking gains in their international counterparts ahead of the U.S. Federal Reserve’s interest rate decision.
Most experts anticipate that the Fed will increase rates by 25 basis points and keep up its battle against inflation, and the markets are waiting for the results of the central bank meeting on Wednesday.
The majority of Gulf countries’ currencies are pegged to the US dollar, and Saudi Arabia, the United Arab Emirates, and Qatar typically follow shifts in US monetary policy.
With gains in most industries, headed by finance and industry, the Qatari Stock Index (.QSI) increased by 0.7%.
The biggest banks in the area, Qatar National Bank and Qatar International Islamic Bank, each saw gains of 0.6% and 1.5%, while giant Industries Qatar saw a 2.9% increase.
Saudi Arabia’s benchmark stock index (.TASI) increased by 0.4% thanks to gains in all industries, headed by the finance, materials, and energy sectors. Real estate developer Retal Urban increased by 0.8%, and Saudi Aramco, the world’s largest oil company, increased by 0.6%.
After the insurer revealed a 44% drop in a full-year pre-Zakat net profit, shares of Gulf Insurance Group fell 6.1%, the most since May 16.
The biggest lender in the United Arab Emirates, First Abu Dhabi Bank, and a 1.7% increase in Alpha Dhabi Holding helped the benchmark stock index (.FTFADGI) in Abu Dhabi rise 0.2%.
Dubai’s benchmark stock index (.DFMGI) dropped 0.3% in early trade as losses in the finance and telecom sectors, including losses at Emaar Properties of 0.5% and Dubai Commercial Bank of 2.1%, weighed on the market.
Emirates Integrated Telecommunications, a provider of telecom services, dropped 3.1%, the steepest intraday fall since May 12, as it was trading ex-dividend.