Mideast Stocks: Most Gulf markets fall on China economic worries, UAE holds up
Most Gulf markets closed lower on Tuesday tracking global peers, as weak economic growth in China renewed concerns about a downturn, but UAE markets continued to rally.
European shares paused their new year rally and Asian equities slipped after data showed China's economic growth in 2022 slumped to one of its worst levels in nearly half a century.
Additionally, data showed China's oil refinery output in 2022 had fallen 3.4% from a year earlier for its first annual decline since 2001, though daily December oil throughput rose to the second-highest level of 2022.
However, OPEC said on Tuesday Chinese oil demand would rebound this year due to relaxation of the country's COVID-19 curbs and drive global growth. It also sounded an optimistic note on the prospects for the world economy in 2023.
The benchmark index in Saudi Arabia fell 0.4%, with luxury real estate developer Retal Urban Development dropping 0.8% while Arab National Bank continued its slide for the third session to close 4% lower. However, oil giant Aramco recovered from its slide by inching up 0.2%.
Meanwhile, Renault SA and China's Geely Automobile Holdings are working to finalize a deal to bring Aramco in as an investor and partner to develop and supply gasoline engines and hybrid technology.
In Abu Dhabi, the index rose 0.1 % with the country's biggest lender First Abu Dhabi Bank up 0.4%. and fertiliser maker Fertiglobe rose 2.2%. Dubai's benchmark index inched up 0.7%, lifted by a 5% rise in Emirates Central Cooling Systems and a gain of 3.5% in utility firm Dubai Electricity and Water Authority.
Qatar Stock index slumped 2.2%, extending losses for six sessions in a row, with almost all the stocks in the index moving into negative territory, led by a 2.5% slide in Gulf's biggest lender Qatar National Bank and a 3.2% decline in Qatar Islamic Bank.
Outside the Gulf, Egypt's blue-chip index added 0.9%, continuing its rally since Wednesday.
Dubai's Container Ports Giant DP World Strikes Positive Tone on Trade - Bloomberg
Container terminal giant DP World took a cautiously upbeat view on global economic prospects, saying World Bank warnings on slower growth and an increased threat of recession may be overly pessimistic.
“I don’t know that all that will happen in 2023,” Chairman Sultan Ahmed Bin Sulayem told Bloomberg Television at the Global Economic Forum in Davos. “We understand that there are issues, but I think that business is capable to deal with it. We learned the hard way during Covid and I think we can overcome it.”
The World Bank slashed growth forecasts for most countries and regions this month and warned that new shocks could tip the economy into a recession. Global gross domestic product will probably increase 1.7% this year, about half the pace forecast in June and the third-worst performance in three decades.
World trade and container volumes will get a boost from China’s reopening, helping to ease the economic situation, though there won’t be an immediate sharp upswing, Bin Sulayem said Tuesday.
Saudi Arabia Open to Talks on Trade in Non-US Dollar Currencies - Bloomberg
Saudi Arabia is open to discussions about trade in currencies other than the US dollar, according to the kingdom’s finance minister, in what could be another challenge to the greenback’s hegemony.
“There are no issues with discussing how we settle our trade arrangements, whether it is in the US dollar, whether it is the euro, whether it is the Saudi riyal,” Mohammed Al-Jadaan told Bloomberg TV on Tuesday in an interview in Davos.
“I don’t think we are waving away or ruling out any discussion that will help improve the trade around the world,” Al-Jadaan said.
The world’s largest oil exporter, which has maintained a currency peg to the dollar for decades, is seeking to strengthen its relations with crucial trade partners including China. The kingdom is a pillar a petrodollar system established in the 1970s that relies on pricing crude exports in the US currency.
