Dubai/Riyadh: The Gulf stock markets are widespread into broad decline early Wednesday owing to increased anxiety over the multiplying U.S.-China trade war and turning tariffs from Washington. Investor confidence in the oil-rich region is taking a dip with the current tensions surrounding the world's two largest economies.
U.S. President Donald Trump had set the alarm bells ringing when he announced he would start an inquiry into the potential tariffs on some critical minerals, including a review of pharmaceutical imports as well as chips, which are bound to heighten fears of a global economic slowdown. Further adding to this is supposed retaliation by Beijing, which has interrupted all airline shipments of U.S.-made Boeing aircraft.
In Saudi Arabia, the main share index fell by 0.4 percent, dragged down by market heavyweights such as Saudi Aramco with a 0.6 percent drop and Riyad Bank lost 1.3 percent. On the other hand, the index of Dubai Bahrain went down 0.7 percent, led by the biggest loss of 2.3 percent in the Emirates NBD and followed by a 1.3 percent decline in Emaar Properties, while Abu Dhabi's market recorded a drop of 0.4 percent, and the Qatari index lost 0.2 percent down with Qatar Islamic Bank's 0.6 percent dip.
Adding to market anxiety is the announcement of the initial public offering (IPO) by United Carton Industries Company that, in launching a stake of 30 percent on the Saudi Exchange, comes on the heels of volatile equity markets under trade-related stress.
Oil prices, the most significant determinant in the economies of the Gulf, edged lower by uncertainty around the globe as investors reveled on how prolonged trade would temper energy demand.
With increasing geopolitical and trade uncertainties, the Gulf markets bee made to continue to face such volatility in the coming weeks, closely entangled with the developments of the U.S. policy and the corresponding actions of China.
[Source Credit: Business Recorder]
