Gulf equities edged lower on Tuesday in volatile trade as investors digested regional interest rate cuts following the U.S. Federal Reserve's move, while lingering uncertainty over the Fed's policy outlook kept sentiment cautious.
The Fed trimmed its benchmark rate by a quarter percentage point last week in response to a softening labour market, but signalled a measured approach to further easing, leaving investors in doubt about the pace of future moves. Subsequently, the central banks of Saudi Arabia, the United Arab Emirates, and Qatar each cut rates by 25 basis points.
Dubai's main share index retreated 1.1% after witnessing two days of strength. Most sectors closed in negative territory, led by a 3.7% decline in toll operator Salik. Emaar Properties fell 1.4%, ending a three-day winning streak, while Emirates NBD Bank declined by 2.4%. National Central Cooling, better known as Tabreed, slipped 1.7% ahead of its ex-dividend date.
Meanwhile, Dubai-based engineering and construction firm, ALEC Holdings, said on Tuesday it aims to raise up to 1.4 billion dirhams ($381.25 million) through an IPO priced between 1.35 and 1.40 dirhams a piece, tapping into a construction boom in the Gulf.
Abu Dhabi's index edged 0.3% lower, snapping three consecutive sessions of strength, hit by a 1.7% drop in Abu Dhabi Commercial Bank. Technology stocks lagged global peers, with Presight AI down nearly 1%. The company, together with investment firm Shorooq, announced the launch of a $100 million global fund to accelerate AI innovation.
Elsewhere, Modon Holding announced the sale of its entire 17.45% indirect stake in Aldar Estates to Aldar Properties, which saw its shares decline 1.7%. While investor sentiment remains cautious amid uncertainty over a sustained market recovery, strong economic fundamentals, the recent rate cut, and ALEC's IPO could offer underlying support, according to George Pavel, general manager at Naga.com Middle East.
Qatar's stock index slipped 0.4%, marking three straight days of losses with selling concentrated in financials and energy shares. Qatar National Bank, the region's largest lender, dropped 3% - its steepest single-day decline in over three months - while Nakilat shed 1.6%.
The Saudi bourse was closed on account of National Day.
Outside the Gulf, Egypt's blue-chip index advanced 0.3%, rebounding after two sessions of losses, boosted by a 3.4% jump in Eastern Company. Credit Agricole rose 0.8% after announcing that its subsidiary, Egyptian Housing Finance, has acquired consumer finance firm Just Finance.
Outside the Gulf, Egypt's blue-chip index advanced 0.3%, rebounding after two sessions of losses, boosted by a 3.4% jump in Eastern Company. Credit Agricole rose 0.8% after announcing that its subsidiary, Egyptian Housing Finance, has acquired consumer finance firm Just Finance.
Investors are now turning their focus to the upcoming third-quarter earnings season, kicking off with Qatar National Bank's report on October 7.
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