July 5 (Reuters) – Gulf stocks were volatile on Wednesday, with the Saudi index snapping three sessions of gains as investors awaited the minutes of the latest Federal Reserve meeting for clues on the outlook for interest rates.
Most GCC countries, including Saudi Arabia, the United Arab Emirates and Qatar, have their currencies pegged to the dollar and closely monitor the Fed’s policy moves, exposing the region to the immediate impact of monetary tightening in the world’s largest economy.
Daniel Takieddine, chief executive of BDSwiss Middle East and North Africa, said the Dubai Stock Exchange was under pressure after surging over the past two days as investors rushed to secure gains.
“While price corrections are likely to persist to some extent, a strong and improving non-oil sector is likely to support sentiment and prices towards new highs.”
Business activity in UAE’s non-oil sector expands A survey released on Wednesday showed new orders rose at the fastest pace in four years in June.
The seasonally adjusted S&P Global UAE Purchasing Managers’ Index rose to 56.9 in June from 55.5 in May and remained above the 50-mark, pointing to a pickup in economic activity.
In Abu Dhabi, the index (.FTFADGI) rose 0.4%.
Oil prices are a key catalyst for Gulf financial markets, Has not changed much That comes as concerns about the global economy collide with supply cuts announced this week by top crude exporters Saudi Arabia and Russia.
Takiddin said the Egyptian market remained under pressure as local business conditions worsened as the non-oil private sector continued to retreat, but at a slower pace than before.
Reporting by Ateeq Shariff in Bengaluru; Editing by Shirpi Majumdar
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