Gulf dips on recession fears
Egypt up on inflation data
DUBAI, Aug 14, (RTRS): Egyptian blue-chip stocks rose to their highest in nearly three and a half months, extending the previous session’s gains, after Egypt reported better-than-expected inflation data for the month of July.
Most Gulf markets traded on Wednesday after a three-day Eid holiday, while Saudi Arabia and Oman will resume trading on Sunday. Egypt’s blue-chip index surged 2.5% to 14,541points, a level not seen since May 5.
The country’s biggest lender Commercial International Bank rose 2.8%, while El Sewedy Electric jumped 8.1%.
Egypt reported on Thursday that its headline inflation rate had fallen to its lowest in nearly four years, dropping to 8.7% in July and defying analyst expectations since it followed afresh round of fuel subsidy cuts that pushed domestic fuel prices up by 16%-30%.
The inflation data provides enough room for the central bank to embark on monetary easing. Last month the monetary policy committee kept key interest rates on hold at 15.75% and 16.75%for overnight deposit and lending, respectively.
But in the Gulf, major markets reversed earlier gains as optimism over Washington delaying tariffs on some Chinese imports gave way to fears that the global economy was heading toward recession in the wake of a slump in Germany’s exports and slowing Chinese industrial growth.
Germany’s disappointing exports sent Europe’s largest economy into reverse in the second quarter as its manufacturers bore the brunt of a global slowdown amplified by tariff conflicts and uncertainty over Brexit.
China’s economy stumbled more sharply than expected in July,with industrial output growth cooling to a more than 17-year low, as the intensifying US trade war took a heavier toll on businesses and consumers Qatar’s index was down 1.6% to 9,676 points, its lowest lose since August 26, 2018. Market heavyweight Industries Qatar decreased 3.9% while Qatar National Bank dropped 2.9%.
In Abu Dhabi the index fell 0.9% with First Abu Dhabi Bank sliding 0.9%, and investment firm Waha Capital plunging 6.9% after swinging to second-quarter loss. In Dubai, the index was down 0.2% with blue-chip developer Emaar Properties and Dubai Islamic Bank both trading 0.6% lower.
Abu Dhabi The index shed 0.9% to 5,054 points
Dubai
The index was down 0.2% at 2,832 points
Qatar
The index dropped 1.6% to 9,676 points
Egypt
The index rose 2.5% to 14,541 points
Bahrain
The index was down 0.3% at 1,540 points
Kuwait
The index was up 0.4% at 6,742 points