GCC stock markets fall on US inflation data

(MENAFN) On Monday, most Gulf stock markets experienced declines as investors adopted a cautious stance in anticipation of significant U.S. inflation data due this week. This data is expected to offer insights into the potential magnitude of an interest rate cut by the Federal Reserve later this month. Last week, market participants reviewed U.S. job data and comments from Federal Reserve officials, which highlighted a weakened labor market but did not provide enough justification for a 50-basis-point reduction in interest rates. The upcoming inflation report, scheduled for release on Wednesday, is anticipated to be a crucial indicator that could alter market expectations regarding the Federal Reserve's decisions at its September 17-18 meeting.

In the Gulf region, stock indices mostly closed lower. The Saudi index recorded a 0.2 percent drop, with notable declines in Al-Taiseer Group and Riyad Bank, which fell by 0.5 percent and 2.1 percent, respectively. The Dubai index saw a 0.3 percent decrease, while the Abu Dhabi index fell by 1 percent. Qatar's index ended the day 0.4 percent lower, with Qatar National Bank, the largest bank in the Gulf, declining by 0.6 percent. In contrast, Egypt's blue-chip index rose by 0.3 percent, supported by a notable 7.9 percent increase in Egypt Kuwait Holding shares following its market maker agreement with the National Investments Company.

Looking ahead, analysts surveyed by Reuters anticipate a continued decline in inflation in Egypt for the sixth consecutive month in August compared to the same period last year, due to the base effect. However, there is also speculation that inflation might rise on a monthly basis following recent government-announced price increases.

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