Most major Gulf markets drop as China COVID surge sours sentiment
4:35 am Thursday, December 29th, 2022
(Reuters) – Most major stock markets in the Gulf fell in early trade on Thursday as soaring COVID cases in China unsettled investors and cast doubt over chances of a swift recovery for the world’s second-biggest economy.
Chinese hospitals and funeral homes were under intense pressure on Wednesday as surging infections drained resources, while the scale of the outbreak and doubts over official data prompted some countries to enact new travel rules on Chinese visitors.
Dubai’s main share index dropped 0.4%, hit by a 0.9% fall in sharia-compliant lender Dubai Islamic Bank.
In Abu Dhabi, the index lost 0.2%, with the United Arab Emirates’ biggest lender First Abu Dhabi Bank losing 0.6%.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.78%, as news from China unsettled investors.
The Qatari index retreated 0.7%, with most stocks in negative territory, including petrochemical maker Industries Qatar, which was down 1.4%.
Oil prices – a key driver for the Gulf’s financial markets – dipped amid dimming hopes of a recovery in fuel demand from China, the world’s largest crude oil importer.
Oil markets were also buffeted by expectations of another U.S. interest rate increase as the Federal Reserve tries to limit price rises in a tight labour market.
Saudi Arabia’s benchmark index, however, bucked the trend to trade 0.4% higher, on course to extend gains for a second session, helped by a 1.4% rise in the kingdom’s biggest lender Saudi National Bank.
(Reporting by Ateeq Shariff in Bengaluru; Editing by Tomasz Janowski)
