Mideast Stocks: Gulf markets mixed on US rate cut hopes

Telecom Egypt SAE

01/12/2025 13:17

Updates to closing prices

By Ateeq Shariff

Dec 1 (Reuters) - Gulf stock markets closed mixed on Monday, as optimism rose over a potential U.S. Federal Reserve rate cut.

Dovish comments from Federal Reserve Governor Christopher Waller and New York Fed President John Williams, combined with weaker-than-expected U.S. economic data, have solidified market expectations for a December rate cut.

CME FedWatch Tool currently prices in an 87% probability of easing from 30% earlier in November.

Core U.S. Personal Consumption Expenditures figures on Friday could provide further cues on the Fed's monetary policy path.

Shifts in U.S. monetary policy have a significant impact on Gulf markets, where most currencies are pegged to the dollar.

In Qatar, the index .QSI edged 0.1%, helped by a 1.4% rise in the Gulf's biggest lender Qatar National Bank QNBK.QA.

Saudi Arabia's benchmark index .TASI dropped 0.5% on a 0.5% fall in Al Rajhi Bank 1120.SE and a 0.9% slide in oil major Saudi Aramco 2222.SE.

Elsewhere, Cherry Trading 4265.SE plunged 5.7% to 26.5 riyals in its debut trade.

"Risk-off" sentiment continues even though the non-oil economy remains backed by solid fundamentals and a positive growth outlook. Neither the rebound in oil prices nor the anticipated December Fed rate cut was enough to lift sentiment, said Daniel Takieddine Co-founder and CEO, Sky Links Capital Group.

"Additionally, liquidity remains constrained due to the high volume of initial public offerings introduced on the market this year."

Oil prices - a catalyst for the Gulf's financial markets - rose 1% as the Caspian Pipeline Consortium halted exports after a major drone attack and U.S.-Venezuela tensions raised concerns about supply, while OPEC+ agreed to leave oil output levels unchanged for the first quarter of 2026.

Brent crude futures LCOc1 advanced 71 cents, or 1.14%, to $63.09 a barrel at 1143 GMT. The contract settled down on Friday for the fourth consecutive month, its longest losing streak since 2023, as expectations for higher global supply weighed on prices.

Crude prices, even after the recent rebound, are still hovering near multi-month lows, putting pressure on the fiscal balances of oil-dependent Gulf nations through lower revenues.

Outside the Gulf, Egypt's blue-chip index .EGX30 lost 0.2%, hit by a 2.1% drop in Telecom Egypt  ETEL.CA.

Saudi Arabia
.TASI dropped 0.5% to 10,543
Qatar
.QSI edged up 0.1% to 10,621
Egypt
.EGX30 eased 0.2% to 40,693
Bahrain
.BAX was up 0.4% to 2,047
Oman
.MSX30 added 0.1% to 5,710
Kuwait
.BKP declined 0.5% to 9,378

 (Reporting by Ateeq Shariff in Bengaluru; Editing by Harikrishnan Nair and Shailesh Kuber)

 ((AteeqUr.Shariff@thomsonreuters.com; +918061822788))