2023-10-18 17:38:03
Stock markets in the Gulf region closed lower today, Wednesday, as tension escalated in the region following the targeting of the Baptist Hospital in Gaza by an Israeli bombing that left more than 500 dead and raised fears of the expansion of the scope of the conflict in the Middle East.
Jordanian Foreign Minister Ayman Al-Safadi announced the cancellation of a four-way summit that his country was scheduled to host with the participation of US President Joe Biden, Egyptian President Abdel Fattah Al-Sisi, and Palestinian Mahmoud Abbas.
The main index of the Saudi market fell 0.2%, with Saudi Telecom shares losing 2.4%, while Sahara International Petrochemicals shares fell 6.7%.
The main index of the Dubai Stock Exchange fell 1.4%, down for the fifth session in a row, once morest the backdrop of a 3.5% decline in Emaar Properties shares and a 2.5% decline in Emirates NBD Bank shares. The index in Abu Dhabi also fell by 0.7%.
Milad Azar, a market analyst at MTB in the Middle East and North Africa, said that the Dubai Stock Exchange recorded another round of price correction, in response to the increasing geopolitical risks in the Middle East.
“However, caution may prevail and the main index may continue to be exposed to downside risks,” he added.
The Qatari index closed 0.8% lower, affected by the 2.7% drop in Qatar Islamic Bank shares.
Outside the Gulf region, the leading stock index in Egypt rose 0.2% to close at an unprecedented high level, supported by a 2.6% gain in the “e-Finance” stock for financial and digital investments.
Oil prices – which support the Gulf region’s economy – were trading at their highest levels in regarding two weeks, driven by concerns related to the Middle East region and data showing a decline in crude inventories.
Today, Archyde.com quoted two sources from OPEC Plus as saying that the group does not intend to take any immediate action following the Iranian Foreign Minister called on OPEC to impose an oil embargo and other sanctions on Israel.
US stock market decline
Wall Street’s main indices opened lower on Wednesday, as rising tension in the Middle East boosted demand for safe-haven assets, with investors also focusing on earnings to gauge the impact of inflation and rising interest rates on companies.
The Dow Jones Industrial Average fell 0.11%, the Standard & Poor’s 500 Index fell 0.36%, and the Nasdaq Composite Index fell 0.70%.
Uncertainty in the global economy
The Director of the International Monetary Fund, Kristalina Georgieva, said a few days ago that the ongoing conflict between Israel and the Palestinian resistance has strengthened global economic uncertainty.
Georgieva said that the current war between Israel and the Palestinians in Gaza constituted another factor for global economic uncertainty, in addition to the Russian-Ukrainian war, the global economic slowdown, and high interest rates and inflation.
Georgieva considered that talking regarding any numbers or statistics regarding the consequences of the conflict, whether on the Israeli economy or the economy of the West Bank and Gaza, or even the global economy, is still early.
She added, “The conflict is still ongoing, and every additional day carries negative effects on the global economy. We are monitoring the situation closely… but it is too early to provide any statistics regarding the conflict on global markets.”
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