Gulf markets pullback persists amidst persistent Israel-Iran clashes
Stock Markets in the Gulf End Lower Amidst Global Uncertainties
Thursday, June 19, 2025, saw many Gulf stock markets plummeting due to heightened regional tensions, particularly the Israel-Iran conflict, uncertain U.S. involvement, and broader global economic uncertainties.
Dubai's main share index dipped 0.7%, substantially impacted by a 2.3% slide in sharia-compliant lender Dubai Islamic Bank and a 1.2% decrease in blue-chip developer Emaar Properties.
Initially, Saudi Arabia's benchmark index managed to reverse losses, climbing 0.2%, thanks to a 4.9% jump in Umm Al Qura Development and Construction. However, the index posted a weekly loss of 2.1%.
Abu Dhabi's index closed 0.8% lower, with mixed performances across different sectors.
The U.S. Federal Reserve held rates steady as expected but maintained predictions for two quarter-point rate cuts this year. Although currencies in the Gulf, including riyals, are pegged to the U.S. dollar, the exact impact of the Fed's decisions on these markets was not thoroughly analyzed in the available reports.
Outside the Gulf, Egypt's blue-chip index dropped 1.9%, as most of its constituents were in the red, including Talaat Moustafa Group Holding, which fell 5.8%.
The ongoing Israel-Iran conflict, potential U.S. involvement, and regional instability led to investor concerns, causing the Average Joe on the street to adopt risk-off behavior, contributing to the bearish sentiment in Gulf stock markets that Thursday.
Brent crude futures edged up $1.06, reaching $77.76 a barrel by 1151 GMT.
Statistical analysis suggests that the Consumer Services and Media & Entertainment sectors in Saudi Arabia declined by 3.6% and 3.4%, respectively, on that Thursday. Notable drops were seen in the Transportation and Telecoms sectors in Qatar, falling by 2.6% and 1.1%, respectively. Top performers in Qatar included Qatar National Cement Company and Ahli Bank, who managed modest gains.
Although not explicit in the reports, the regional conflict overlapping with broader global uncertainties likely heightened risk aversion among investors. This cautious sentiment resulted in bearish trends across the Gulf Cooperation Council countries that day.
- The ongoing Israel-Iran conflict, potential U.S. involvement, and regional instability impacted the investment decisions in various sectors such as Consumer Services, Media & Entertainment, Transportation, and Telecoms within the Gulf Cooperation Council countries.
- In the general-news context, Iran's ongoing conflict with Israel and the uncertainty surrounding U.S. involvement led to a higher level of risk aversion among investors, which was evident in the bearish trends observed in the stock markets of Gulf Cooperation Council countries.
- The impact of Federal Reserve's decisions, such as the prediction for two quarter-point rate cuts in 2025, on the Gulf region's stock markets requires further analysis, as discussed in some reports; however, the regional conflict and broader global uncertainties likely contributed to the risk-off behavior seen among average investors in these markets.
