Gulf Stocks Climb on Growth Boost, Eyes on U.S. Jobs

Photo: Reuters

Stock markets across the Gulf region rose in early trading on Thursday, supported by steady growth in the non-oil private sector. Investors are also waiting for a key jobs report from the United States, which could give hints on when the U.S. Federal Reserve might reduce interest rates.

In Saudi Arabia, the main stock index increased by 0.4%. Most sectors performed well, especially finance, materials, and energy. Saudi National Bank, the kingdom’s largest bank by assets, gained 1.6%, while Saudi Aramco, the country’s oil giant, rose by 0.6%. Fawaz Abdulaziz Al Hokair & Company, a retailer, was the top gainer on the index, jumping 7%. Saudi Basic Industries also added 1.3%.

A survey showed that Saudi Arabia’s non-oil private sector activity grew faster in June. This was mainly due to strong customer demand and a rise in hiring. The Riyad Bank Saudi Arabia Purchasing Managers' Index (PMI) went up to 57.2 in June, compared to 55.8 in May. A PMI above 50 means the sector is expanding.

In the United Arab Emirates, the Abu Dhabi stock index rose by 0.2%. This was driven by a 4% gain in Presight AI and a 3.2% rise in Space42. In Dubai, the main index increased by 0.6%, thanks to gains in the real estate, utilities, and industry sectors. Emaar Properties rose by 1.5% and toll operator Salik climbed 1.7%.

Another survey showed that the UAE’s non-oil private sector also grew steadily in June, even though regional tensions affected demand slightly. Companies increased their output to deal with existing backlogs of work.

In Qatar, the benchmark index was mostly flat. Qatar Gas Transport added 0.5%, while Qatar Islamic Bank fell by 0.7%.

The focus of global investors is now on the upcoming U.S. jobs report, which is expected later in the day. This report may influence the Federal Reserve’s decision on interest rates. Currently, market indicators suggest there is a 25% chance the Fed might cut rates this month.

Because most Gulf countries have their currencies linked to the U.S. dollar, any move by the U.S. central bank has a strong effect on monetary policies in the region.