Global markets fall weighs on Gulf stocks

Most major Gulf stocks fell in early trading on Wednesday, taking their cue from global stocks which dropped following weak economic data in the United States and Europe.

The U.S. manufacturing sector contracted in September to its weakest level in more than a decade as business conditions deteriorated further amid trade tensions between China and the United States.

Manufacturing activity in the euro zone contracted at its steepest rate in almost seven years last month, according to a survey on Tuesday that suggested there would not be a turnaround any time soon.

Saudi Arabia’s index was 0.4 percent down as Riyad Bank lost 1.8 percent, while country’s largest lender National commercial Bank was down 1.1 percent.

Maharah Human Resources declined 2.7 percent as the stock traded ex-dividend.

But the fuel retailers Aldrees Petroleum and Transport Services and Saudi Automotive Services both surged 10 percent following the news that Ministry of Energy has increased profit margins of fuel stations and other service centres.

Saudi Arabia’s economy slowed sharply in the second quarter amid oil output cuts by the world’s largest crude exporter, government data showed on Monday, raising fears of an economic contraction this year.

Moreover, Rating agency Fitch downgraded Saudi Arabia’s credit rating to A from A+ on Monday, citing rising geopolitical and military tensions in the Gulf following an attack on its oil facilities and a deterioration of the kingdom’s fiscal position.

Qatar’s index edged down 0.3 percent as Qatar Gas Transport and Barwa Real Estate both fell 1.2 percent.

Qatar’s economy contracted by 1.4 percent in the second quarter compared to a year earlier, according to government statistics, hurt by a drop in the manufacturing and construction sectors.

Abu Dhabi’s index dropped 0.3 percent, with First Abu Dhabi Bank losing 0.4 percent, and Emirates Telecommunications slipping 0.6 percent.

In Dubai, the index was also down 0.3 percent led by a 1.7 percent fall in market heavyweight Emaar Properties.

Source: Reuters