Middle Eastern bourses fall on renewed US-Iran tensions | Reuters

Middle Eastern bourses fall on renewed US-Iran tensions | Reuters

Gulf equities ended lower on Monday, on fears the ceasefire between Washington and Tehran could unravel after the U.S. seized an Iranian cargo vessel, while traffic through the Strait ​of Hormuz remained largely suspended.

Hopes for a more lasting peace in the region dimmed after Iranian ‌state media reported that Tehran had rejected fresh talks and would not take part in a second round of negotiations the U.S. had hoped to convene before the ceasefire expires on Tuesday.

Now in its eighth week, the war has triggered a historic ​shock to global energy supplies, sending oil prices soaring as the Strait of Hormuz remains effectively closed.

Dubai's ​main share index (.DFMGI), opens new tab retreated 2.1%, snapping four sessions of gains, hit by a 2.3% ⁠fall in blue-chip developer Emaar Properties (EMAR.DU), opens new tab and a 2.9% slide in toll operator Salik Co (SALIK.DU), opens new tab.

Budget airline Air Arabia (AIRA.DU), opens new tab ​finished 3% lower.

Renewed Middle East tensions hit sentiment, with regional markets driven by geopolitical headlines and the Strait ​of Hormuz in focus after a shift in rhetoric over the weekend, said Daniel Takieddine, co-founder and CEO of Sky Links Capital Group.

Resilient domestic fundamentals may help limit the downside, while signs of de-escalation or strong earnings could support a rebound.

In ​Abu Dhabi, the index (.FTFADGI), opens new tab lost 0.8%, dragged down by a 2.7% decline in Aldar Properties (ALDAR.AD), opens new tab.

The United Arab Emirates ​has begun talks with the United States on a potential financial backstop should the U.S.-Israeli war on Iran deepen the Gulf ‌nation's ⁠crisis, the Wall Street Journal reported on Sunday. Reuters could not immediately verify the report.

Saudi Arabia's benchmark index (.TASI), opens new tab closed 0.9% lower, weighed down by a 1.2% fall in Al Rajhi Bank (1120.SE), opens new tab. On the other hand, Saudi Aramco (2222.SE), opens new tab gave up early gains to end flat.

According to Takieddine, elevated oil prices could offer a supportive backdrop, helping to cushion ​downside risks and stabilize sentiment.

Brent ​crude futures advanced $4.37, or ⁠4.8%, to $94.75 a barrel, as investors dealt with conflicting messages about the war.

The Qatari index (.QSI), opens new tab lost 0.4%, with Qatar Islamic Bank (QISB.QA), opens new tab dropping 1.8%.

U.S. President Donald Trump had earlier ​warned that the United States would destroy Iran's bridges and power plants if Tehran ​refused his ⁠terms, repeating threats he had made throughout the war.

Iran, meanwhile, said any U.S. attack on its civilian infrastructure would trigger strikes on power stations and desalination plants in neighboring Gulf Arab states.

Outside the Gulf, Egypt's blue-chip index (.EGX30), opens new tab slipped 1.1%, ⁠with ​Commercial International Bank (COMI.CA), opens new tab losing 1.6%.