Most of the Gulf stock markets closed at the close today, Tuesday, as investors assessed the decline in oil prices and concerns about negotiations to raise the US public debt ceiling.
The main index of the Saudi stock market fell 0.2%, affected by the 2.1% decline in Aramco’s share.
Oil futures were stable, as weaker-than-expected Chinese economic data offset the positive impact of the International Energy Agency’s expectations of an increase in global demand, according to Reuters.
The US Energy Department said on Monday it would buy 3 million barrels of crude oil for delivery in August, with the aim of replenishing the strategic reserve.
The Dubai market index fell 0.5%, continuing its decline for the fourth consecutive session, under the weight of the 3.2% decline in Tecom Group’s shares.
Ahmed Negm, head of Middle East and North Africa market research at XS.com, said that the Dubai Stock Exchange continued to decline following the results of some companies today, at a time when global sentiment tends to be cautious.
He added, “The main index has abandoned its bullish trend and may witness more price correction movements if dealers continue to sell.”
In Abu Dhabi, the index bucked the trend to close up 0.1%.
The Qatari index lost 0.1%.
Yesterday, Monday, US President Joe Biden and House Speaker Kevin McCarthy prepared for difficult talks about the government debt ceiling, less than two weeks before the government’s possible default on its obligations.
Economists said that the failure of the US government to pay for the first time in its history would lead to a recession in the economy and cause chaos in the financial markets, while the confrontation over raising the debt ceiling began to cause concern for investors and consumers.
Outside the Gulf region, the Egyptian index closed down 0.6%, with Abu Qir Fertilizers falling 2.5%.
Negm said the Egyptian stock market continues to decline as risk appetite subsides, while overseas investors monitor developments in the United States. The deteriorating sentiment globally may exacerbate the current sell-off among foreign investors.
