Markets Saudi index hits 6-month low amid US recession fears By Reuters July 15, 2022 Creative Commons Saudi Arabia's benchmark index dropped 1.1 percent, hitting its lowest since late-December, dragged down by a 1 percent fall in Retal Urban Development Company and Sahara International Petrochemical Co which dropped 8 percent. Most stock markets in the Gulf fell on Thursday, with the Saudi index wiping out its gains so far this year, as a red-hot US inflation reading bolsters the case for supersized rate hikes by the Federal Reserve. Wednesday’s data showed US consumer prices jumped 9.1 percent year-on-year in June, the largest annual increase in inflation in 40-1/2 years. The data was seen as firming the case for the Federal Reserve to raise rates aggressively. Policymakers might consider a 100-basis-point increase in the July meeting, Atlanta Federal Reserve Bank President Raphael Bostic said. Saudi Arabia’s benchmark index dropped 1.1 percent, hitting its lowest since late-December, dragged down by a 1 percent fall in Retal Urban Development Company and Sahara International Petrochemical Co which dropped 8 percent. Oil prices, a key catalyst for the Gulf’s financial markets fell more than $2 as investors focused on the prospect of a large US rate hike later this month that could stem inflation but at the same time hit oil demand. Worries of COVID-19 curbs in multiple Chinese cities to rein in new cases of a highly infectious subvariant have also kept a lid on oil prices. In Qatar, the index eased 0.1 percent, hit by a 3.7 percent decline in petrochemical maker Industries Qatar. Elsewhere, the Kuwaiti index, which traded after a four-session break, concluded 0.5 percent lower. Dubai’s main share index advanced 1.3 percent, led by a 3.4 percent rise in top lender Emirates NBD and a 2.4 percent gain in blue-chip developer Emaar Properties. The Dubai bourse rebounded from the previous session’s fall, supported by the real estate sector which is seeing strong sales, said Eman AlAyyaf, CEO of EA Trading. “However, the sector and the market as a whole remain exposed to a more aggressive monetary policy in the U.S..” Abu Dhabi stocks added 0.9 percent, with the country’s biggest lender First Abu Dhabi Bank closing 2 percent higher. SAUDI ARABIA fell 1.1 percent to 11,163 ABU DHABI up 0.9 percent to 9,244 DUBAI rose 1.3 percent to 3,154 QATAR eased 0.1 percent to 11,868 BAHRAIN down 1.2 percent to 1,850 OMAN added 0.7 percent to 4,141 KUWAIT dropped 0.5 percent to 8,185
