Most stock markets in the Gulf ended higher on Wednesday after U.S. Federal Reserve Chair Jerome Powell's dovish comments improved global investor sentiment, even as soft oil prices amid a supply surplus and U.S.-China trade tensions capped gains.
Powell signalled potential additional rate cuts on Tuesday and said the end of the central bank's long-running effort to shrink the size of its holdings may be coming into view.
His comments, viewed by some as dovish, lifted global markets slightly and reinforced expectations of more easing this year, with roughly 48 basis points worth of cuts priced in by December.
The Fed's stance holds implications for Gulf economies, where most currencies are pegged to the U.S. dollar, making it an anchor for regional monetary stability.
Saudi Arabia's benchmark index (.TASI), opens new tab gained 0.7%, led by a 0.8% gain in Al Rajhi Bank (1120.SE), opens new tab and a 6% jump in ACWA Power Company (2082.SE), opens new tab.
The International Monetary Fund upgraded its 2025 economic growth forecast for Saudi Arabia on Tuesday due to a faster-than-expected unwinding of oil production cuts in the world's top crude exporter.
Dubai's main share index (.DFMGI), opens new tab added 0.1%, helped by a 0.7% rise in blue-chip developer Emaar Properties (EMAR.DU), opens new tab.
In Abu Dhabi, the index (.FTFADGI), opens new tab closed 0.1% higher.
Oil prices - a catalyst for the Gulf's financial markets - steadied after closing at five-month lows in the previous session, as investors weighed the International Energy Agency's prediction of a supply surplus in 2026 and trade tensions between the U.S. and China that could curtail demand.
The Qatari index (.QSI), opens new tab dropped 0.5%, with Qatar Islamic Bank (QISB.QA), opens new tab losing 1.2%.
Outside the Gulf, Egypt's blue-chip index (.EGX30), opens new tab rose 0.5%, with Commercial International Bank (COMI.CA), opens new tab advancing 1.4%.
Egypt has a plan for the drilling of 480 exploratory oil wells on the basis of investments totalling $5.7 billion over the next 5 years, the country's petroleum minister said on Tuesday, as the country seeks to reverse declining production.
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