Gulf Markets decline amid concerns over China's economy

Most stock markets across the Gulf region experienced a decline in early trading on Tuesday, following a downward trend in oil prices. The drop in oil prices was attributed to concerns over China's fragile post-pandemic economy, particularly as weak service sector data surfaced.

Crude oil prices, which play a pivotal role in influencing Gulf financial markets, decreased by 0.33 per cent, with Brent crude trading at $88.71 per barrel as of 0700 GMT.

On Tuesday, a private sector survey revealed that China's service sector activity expanded at its slowest rate in eight months in August, highlighting persistent issues with demand in the world's second-largest economy.

Benhcmark stock indices 

In Abu Dhabi, the benchmark stock index recorded an 0.8 per cent decline, primarily driven by a 2.5 per cent decrease in Abu Dhabi Islamic Bank and a 1 per cent drop in ADNOC Drilling. First Abu Dhabi Bank, the largest lender in the United Arab Emirates, also faced a substantial drop of 2.4 per cent.

Qatar's benchmark index witnessed a 0.5 per cent decline, with Qatar Islamic Bank experiencing a 1.3 per cent decrease and the Gulf's largest lender, Qatar National Bank, shedding 1.1 per cent of its value.

In early trading, Dubai's benchmark stock index declined by 0.3 per cent, with losses across most sectors. Notable declines included Union Properties, which saw a 2.2 per cent decrease, and Emirates Integrated Telecommunications, which dropped by 1.3 per cent. Leading banks in the emirate, Emirates NBD and Dubai Islamic Bank, both experienced losses of 0.9 per cent.

Saudi Arabia's benchmark stock index reported a 0.1 per cent decline, with oil giant Aramco decreasing by 0.2 per cent, and Dr. Sulaiman Al-Habib Medical Services sliding by 0.4 per cent. Al Rajhi Bank, the world's largest Islamic bank by assets, recorded a 0.3 per cent decrease, while Saudi Arabian Mining slipped by 0.9 per cent.

The decline in Gulf markets reflects the impact of weaker oil prices and concerns surrounding China's economic performance, underscoring the sensitivity of the region's financial markets to global economic factors.

(With Reuters Inputs)