On Sunday, Gulf markets displayed divergent movements amid economic uncertainty. Traders assessed the impact of new trade threats from the U.S. and corporate earnings reports.
Saudi Arabia's Financial Performance
Saudi stocks opened strongly but did not maintain their levels. The Tadawul index dropped by 0.4%, marking its ninth consecutive loss, the longest streak in nearly two years. The decline was broad-based, affecting banks, mining, and retail sectors. Saudi National Bank shares dipped 0.8%. The Saudi Arabian Mining Company lost 1.3% following the voluntary retirement of its CFO. The most significant hit was taken by Fawaz AbdulAziz Al Hokair & Co., which plummeted by 10%. Investors reacted negatively to the news about the sale of 49.95% of its shares to Al Futtaim Retail for 2.5 billion riyals (approximately $666 million).
Qatar's Rise and Egypt's Record Highs
Conversely, Qatar's main stock index rose by 0.2%, boosted by a 1.2% gain in Industries Qatar, a petrochemical giant. This modest increase brought the market closer to a two-year high. Egypt's EGX30 index climbed by 0.7%, reaching a record high. This optimism stemmed from the anticipated $8 billion IMF deal. Finance Minister Ahmed Kouchouk expressed confidence that Egypt would meet its reform milestones by September or October. Furthermore, Bonyan Development and Trade launched an IPO that was oversubscribed over 33 times, generating additional buying pressure.
ECB Concerns and Predictions
In Europe, the focus remains on banks' ability to sustain earnings momentum. Analysts expect the Stoxx 600 EPS to turn positive. However, many companies, including Unicredit, face pressure due to M&A complications. ECB President Christine Lagarde is expected to maintain interest rates at 2% during the upcoming meeting, but concerns arise about U.S. tariff impacts prompting potential ECB rate cuts. Deutsche Bank raised alarms about inflation risks, warning of significant market repercussions if tariffs escalate.
The current economic landscape in the Gulf markets is characterized by substantial fluctuations influenced by both domestic issues and international trade threats. Market participants are closely monitoring developments.
