Mideast Stocks: #Dubai drags Gulf markets lower as #Iran war risks weigh

Mideast Stocks: Dubai drags Gulf markets lower as Iran war risks weigh

Most Gulf equities erased early advances to finish ​lower on Wednesday, led ⁠by a sharp decline in Dubai, as investors stayed cautious over inflation and growth risks stemming from the U.S.-Israeli ‌war against Iran.

The U.S. and Israel launched what the Pentagon and sources in Iran described as the most intense airstrikes of the war, even ​as global markets continued to bet that President Donald Trump would seek to bring the conflict to an end soon.

The war has effectively ​shut the ​Strait of Hormuz — a key route for roughly one-fifth of global oil and liquefied natural gas flows — forcing producers to halt output as storage fills and sending energy prices sharply higher.

Dubai's main index dropped 2.4%, hit ⁠by a 4.7% slide in blue-chip developer Emaar Properties and a 4.9% decline in top lender Emirates NBD.

However, Air Arabia ended 0.7% higher. The budget airline was set to snap a five-session decline, having lost more than 20% in the preceding five trading days.

Two drones fell near Dubai's main airport and Bahrain evacuated some aircraft on Wednesday, as attacks on Gulf infrastructure kept disrupting air ​traffic and hindered attempts to ‌restore flights on ⁠the 12th day of ⁠the war.

The fighting has disrupted global aviation, causing tens of thousands of cancellations, reroutings and schedule changes, while missile and drone threats ​shut much of Middle East airspace, including Qatar's.

In Abu Dhabi, the index fell 0.3%. Investors are ‌likely to stay highly sensitive to fresh headlines and regional developments, while swings ⁠in oil prices and logistical disruptions may continue to pose risks for some markets to varying degrees, said Daniel Takieddine, co-founder and CEO of Sky Links Capital Group.

Saudi Arabia's benchmark index was up 0.1%, helped by a 1% rise in oil major Saudi Aramco.

Oil prices rebounded on Wednesday reflecting doubts whether the International Energy Agency's reported plan for a record release of oil reserves could mitigate potential war-related supply shocks.

According to Ahmad Assiri, research strategist at Pepperstone, the Saudi market remains relatively stable, supported by oil prices above $87 per barrel and export flows through Yanbu on the Red Sea, which put the Saudi market in a better position than its neighbours.

Saudi miner Saleh Abdulaziz Al Rashed and Sons Co surged more than ‌14%, marking the Gulf region's first market debut since the start of the war.

The ⁠Qatari index dropped 0.9%, hit by a 2.1% decline in Qatar National Bank, ​the Gulf's biggest lender by assets.

Several companies that buy liquefied natural gas from QatarEnergy — either as portfolio players or offtakers — including Shell, TotalEnergies, and some Asian firms, have declared force majeure, Reuters reported on Wednesday.

Elsewhere, Oman's index fell 0.5%, though it remains up more than 31% ​for the year.

The ‌Muscat market saw selective buying, allowing the index to break resistance and stay above 7,700, ⁠Assiri said.

Bahrain's benchmark edged 0.1% higher and Kuwait's added ​0.5%.

Outside the Gulf, Egypt's blue-chip index fell 1.2%.