(Reporting by Shamsuddin Mohd; Editing by Hugh Lawson)
By Shamsuddin Mohd
March 9 (Reuters) - Gulf equities were subdued on
Thursday after the U.S. Federal Reserve chief's hawkish comments
on higher and faster interest rate hikes dampened investor
sentiment, but strong economic data propelled Saudi Arabia's
index to a higher close.
U.S. Federal Reserve chief Jerome Powell had stuck to his
message of higher and potentially faster interest rate hikes
during a hearing on Wednesday.
Aggressive rate hikes may pose challenges for the Gulf
economy as most Gulf Cooperation Council (GCC) countries have
their currencies pegged to the dollar and generally follow the
Fed's policy moves, exposing them to any monetary tightening.
Oil prices, which are highly correlated to Gulf financial
market moves, were mostly trading on the back foot after tepid
growth data from China and on worries that higher interest rates
in the United States could slow global economic growth,
squeezing oil demand.
Saudi Arabia's benchmark stock index gained 0.5%,
boosted by gains in almost all the sectors with financial and
energy shares, with Al Rajhi Bank advancing 1.4% while
index heavyweight and state oil giant Saudi Aramco ,
which will report its annual earnings on Sunday, was up 0.9%.
The Saudi economy grew 5.5% year-on-year in the fourth
quarter of 2022, slightly more than expected, as non-oil
activity boosted overall growth.
The strong economic data has improved sentiment despite the
uncertainty surrounding around Powell’s testimony and volatile
oil prices, said Ahmed Negm, Head of Market Research MENA at
XS.com.
In Abu Dhabi, the benchmark index dropped 0.8%,
its third straight day of decline, weighed down by a 3.3% dive
in top lender First Abu Dhabi Bank , its biggest
intraday fall in more than a month.
Elsewhere, Bank of Sharjah is set to raise $500
million for a sale of senior unsecured five-year bonds. Stock
was down 2.5%.
Dubai's main share index also extended losses for a
third consecutive session to close 0.5% lower, pressured by a
2.3% retreat in its biggest lender Emirates NBD and a
1.4% decrease in blue-chip developer Emaar Properties .
The Qatari benchmark index declined 0.3%, snapping a
six-day rally but ended the week with a 1.1% gain.
Qatar National Bank , the Gulf's biggest bank by
assets falling 1.4% and Qatar Navigation (Milaha) shedding 2.6%.
Outside the Gulf, Egypt's blue-chip index , closed
0.9% higher, ending a five-session losing streak, with
Commercial International Bank Egypt gaining 1.4%.
SAUDI ARABIA rose 0.5% to 10,463
ABU DHABI lost 0.8% to 9,860
DUBAI dropped 0.5% to 3,410
QATAR eased 0.2% to 10,737
EGYPT rose 0.9% to 16,454
BAHRAIN flat at 1,912
OMAN slipped 0.1% 4,850
KUWAIT was down 0.3% to 8,138
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