May 2 (Reuters) - Major stock markets in the Gulf were
mixed in early trade on Tuesday as investors await this week's
interest rate decision by the U.S. Federal Reserve.
Saudi Arabia's benchmark index added 0.2%, with
Retal Urban Development Co losing 0.8% and oil giant
Saudi Aramco declining 0.7%.
The Fed is predicted to raise rates by another 25 basis
points Wednesday. The U.S. central bank has raised its policy
rate by 475 basis points since March last year from the
near-zero level to the current 4.75%-5.00% range.
Most Gulf Cooperation Council countries, including Saudi
Arabia, the United Arab Emirates and Qatar, have their
currencies pegged to the U.S. dollar and follow the Fed's policy
moves closely, exposing the region to a direct impact from
monetary tightening in the world's largest economy.
However, Saudi National Bank (SNB) added 0.5%,
after reporting a rise in first-quarter net profit.
In Abu Dhabi, the index dropped 0.3%, on course
to extend losses from the previous session.
Oil prices - a key catalyst for the Gulf's financial markets
- fell in Asian trade, extending losses seen in the previous
session, as weak economic data from China and expectations of a
U.S. interest rate increase weigh on the market.
Dubai's main share index gained 0.5%, with utility
firm Dubai Electricity and Water Authority advancing
1.6%.
The Qatari benchmark firmed 0.1%.
(Reporting by Ateeq Shariff in Bengaluru)
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