Stock markets in the Gulf halted trading on Thursday as fears of possible military action by the United States against Iran heightened concerns that the region would bear the brunt of Iranian retaliation.
US President Donald Trump, who has repeatedly threatened to intervene in the crackdown on Iran, expanded his options for potential military action this week by sending a US aircraft carrier and supporting warships to the Middle East.
Saudi Arabia Indicator Index<.TASI>fell 0.7%, Al Rajhi Bank<1120.SE>‘s 1.3% decline and ACWA Power’s 2.6% decline, ending its winning streak after five days.
Meanwhile, oil giant Saudi Aramco<2222.SE>rose 0.6%. Crude oil prices, a key driver of Gulf financial markets, hit a four-month high after President Trump warned Iran that it could attack if it does not agree on nuclear weapons.
Milad Azar, a market analyst at XTB MENA, said that while most sectors fell on the day, Aramco’s losses in the energy sector were contained, supported by higher oil prices.
Azar said sentiment continues to be supported by optimism ahead of fourth-quarter results and the opening of the market to foreign investors next week, with room for further upside from strong results, solid oil prices and strong non-oil fundamentals.
Al Jazeera Bank<1020.SE>rose 4.2%, its first intraday rise in four months, after a strong increase in annual net profit and the proposed cash dividend of 0.50 riyals per share for the second half of the year (the first in three and a half years).
In mid-January, Saudi Arabia, Qatar, Oman, and Egypt urged the United States not to attack Iran.
Dubai’s main stock index<.DFMGI>fell 0.5%, weighed down by a 1.4% decline in rate management company Sarik.
Index in Abu Dhabi market<.FTFADGI>fell 0.3%, while Abu Dhabi Commercial Bank fell 1.7%. Net profit for the fourth quarter was 3.34 billion dirhams ($909.41 million), up from 2.57 billion dirhams a year earlier, the company announced after market hours.
The UAE said on Monday it would not allow its airspace, territory or waters to be used for hostile military actions against Iran, reaffirming its commitment to neutrality and regional stability.
qatar index<.QSI>ended 0.6% lower, while Qatar National Bank, the Gulf’s biggest asset lender, fell 1.3%.
The Egyptian Stock Exchange was closed due to the public holiday.
(Reporting by Ateeq Shariff in Bengaluru; Editing by Janane Venkatraman and Shilpi Majumdar)
