Gulf Stock Markets to consolidate ahead of Holy Month of Ramadan

Middle East stock markets look set to consolidate with a negative bias Wednesday as investors in the region prepare for the Muslim holy month of Ramadan, which begins Thursday and usually brings a period of very low trading activity.

Trading volumes in most markets have already been declining in the last few days and some bourses, such as Egypt’s stock exchange, are reducing trading hours during Ramadan.

The Cairo market will close one hour earlier than usual, at 1130 GMT.

Some market players had expected this Ramadan to be different in Saudi Arabia, which this week opened its market to direct foreign investment.

But modest volumes in the first two days of trade after the opening indicate foreigners are in no rush to buy local stocks.

Stock exchange data showed no fresh, significant purchases by licensed foreign investors on Tuesday.

In Dubai, the arrival of Ramadan may reduce speculative activity, which has made the market very volatile in recent weeks and focused on mid-cap stocks such as Amlak Finance and Dubai Parks and Resorts.

Oil prices have been nearly flat so far on Wednesday as firm demand meets strong output, with the market waiting for US storage figures later in the day.

The US dollar also has not moved as investors wait for clues from a Federal Reserve meeting on when US interest rates are likely to rise.

Asian shares are holding near three-month lows.

Source: Reuters