Mideast Stocks: Gulf markets gain on potential US rate hike pause, debt bill optimism

Mideast Stocks: Gulf markets gain on potential US rate hike pause, debt bill optimism

Major stock markets in the Gulf rose in early trade on Thursday, as a potential pause in U.S. interest rate hikes and the debt ceiling bill passing a crucial vote renewed optimism.

U.S. Federal Reserve officials on Wednesday pointed towards a potential rate hike "skip" in June, which reversed market expectations of an imminent hike that could slow economic growth and weaken oil demand.

Most Gulf currencies are pegged to the U.S. dollar, while Saudi Arabia, the United Arab Emirates and Qatar usually mirror monetary policy changes in the United States.

Additionally, the U.S. House of Representatives' passage of a bill suspending the government's $31.4 trillion debt ceiling improved the chances of averting a disastrous government default.

Saudi Arabia's benchmark index gained 0.4%, led by a 1.8% rise in Al Rajhi Bank Banking and Investment Corp and a 0.6% increase in oil giant Saudi Aramco.

Separately, Lucid Group Inc said it plans to raise about $3 billion through a stock offering, nearly two-thirds of which will come from Saudi Arabia's Public Investment Fund (PIF), sending shares of the luxury electric vehicle maker down 9% after market hours.

Dubai's main share index added 0.1%, helped by a 0.7% rise in toll operator Salik Company PJSC .

Meanwhile, Dubai's ruler on Wednesday announced a new plan for the Palm Jebel Ali, a man-made palm-shaped island that has been dormant since 2009 following a real estate crash, and is double the size of the functioning Palm Jumeirah.

In Abu Dhabi, the index was up 0.2%.

The Qatari benchmark added jumped 1.4%, with almost all the stocks in positive territory including Qatar Islamic Bank QPSC, which advanced 1.7%.