Major stock markets in the Gulf fell in early trade on Wednesday amid weak oil prices and as worries about the global growth outlook drove investors away from risky assets.
U.S. manufacturing contracted at a moderate pace in August amid some improvement in employment, but a further decline in new orders and rise in inventory suggested factory activity could remain subdued for a while.
A slew of U.S. economic data is due this week, including figures on job openings, jobless claims and the closely-watched non-farm payrolls report which is due on Friday.
Given the Federal Reserve's focus on the labour market, the payrolls report could decide whether the U.S. central bank will likely cut rates by 25 basis points or a super-sized 50 bps.
Monetary policy in the six-member Gulf Cooperation Council, including Saudi Arabia, is usually guided by the Fed's decisions, as most regional currencies are pegged to the U.S. dollar.
Saudi Arabia's benchmark index (.TASI), opens new tab dropped 0.6%, weighed down by a 1.3% fall in aluminium products manufacturer Al Taiseer Group (4143.SE), opens new tab.
Among other losers, oil giant Saudi Aramco (2222.SE), opens new tab was down 0.7%.
Oil prices - a catalyst for the Gulf's financial markets - fell, extending a plunge of more than 4% the previous day and hovering at their lowest since December, on expectations that a political dispute halting Libyan exports could be resolved and concerns over sluggish global demand.
Concerns over the sluggish outlook in China - the world's biggest oil importer - and the possibility of a global slowdown that would mean reduced fuel demand have exacerbated the decline in oil prices.
Dubai's main share index (.DFMGI), opens new tab lost 0.3%, hit by a 1.1% drop in blue-chip developer Emaar Properties (EMAR.DU), opens new tab.
In Abu Dhabi, the index (.FTFADGI), opens new tab declined 0.5%.
The Qarari benchmark (.QSI), opens new tab retreated 0.5%, with Qatar Islamic Bank (QISB.QA), opens new tab losing 1%.
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