Gulf stocks rebound despite Fed comments and geopolitical tensions

Gulf markets: Major stock markets across the Gulf region witnessed a rebound in early trading on Thursday, April 18. This positive movement comes after experiencing losses in the previous two trading sessions.

Saudi Arabia's TASI was up 0.3 per cent, potentially ending its two-day losing streak. Key contributor Saudi Arabian Mining Company surged 4.1 per cent after the launch of single stock options contracts. Allianz Saudi Fransigained 0.3 per cent following a 51 per cent stake acquisition by Abu Dhabi National Insurance CO for $133.1 million.

Limited oil price impact

Oil prices, a crucial driver for Gulf financial markets, remained relatively flat after a 3 per cent decline on Wednesday. Concerns about global demand for oil in 2024 and potential conflicts in the Middle East continue to influence the market.

US interest rate policy

Following comments from top US Federal Reserve officials, including Chair Jerome Powell, investor hopes for significant interest rate cuts in 2024 were dashed. The Fed reiterated the need for prolonged restrictive monetary policy. This stance is likely to be mirrored by Gulf countries whose currencies are pegged to the US Dollar.

Dubai's main index (.DFMGI) reversed its four-day losing streak with a 1 per cent gain. Blue-chip developer Emaar Properties contributed to the rise. Crypto exchange Binance received a license from Dubai's Virtual Assets Regulatory Authority. This allows them to expand their services to retail clients in the region.

Overall, the Gulf markets exhibited a positive correction on Thursday. While oil price movements and US monetary policy remain factors to watch, the region's financial sector is demonstrating signs of recovery.

(With Reuters inputs.)