Gulf stocks feel heat from US-China dispute

Abu Dhabi’s stock market fell on Thursday, leading a tumble of most Arabian Gulf bourse’s as fears spread of an escalating trade dispute between the United States and China.

Analysts blame the retreat in world stock markets on the uncertainty around the trade policy of the Donald Trump administration.

Mr Trump said on Wednesday he wants to raise the tariff on $200 billion of Chinese goods to 25 per cent from a previously proposed 10 per cent, later rattling Asian stocks.

Abu Dhabi’s benchmark index closed down 0.7 per cent, pulled down by financial, telecom and energy stocks.

The UAE’s largest lender First Abu Dhabi Bank lost 0.7 per cent and Etisalat, also known as Emirates Telecommunications Group, fell 1.2 per cent. Energy shares Dana Gas and Abu Dhabi National Energy or Taqa lost 2.7 per cent and 1.7 per cent, respectively, as oil prices fell for a third day.

Saudi Arabia, Russia, Kuwait and the UAE have increased production, as agreed at a meeting in June, to help to compensate for an anticipated shortfall in Iranian crude supplies once US sanctions come into force later this year.

In Saudi Arabia financial stocks weighed on the region’s biggest stock market to drag the main index down 0.4 per cent. Al Rajhi Bank fell 0.8 per cent, Alinma Bank closed down 1.6 per cent, and Riyad Bank lost 1 per cent.

The Saudi Arabian bourse saw some support from National Commercial Bank which rose 0.4 per cent and Jarir Marketing gained 1 per cent. In Dubai, developer Emaar Properties and its units Emaar Development and Emaar Malls lost 0.7 per cent, 0.4 per cent, and 1.4 per cent, respectively. Emaar Malls had gained earlier this week after reporting on Monday a nearly 15-per cent jump in quarterly earnings, broadly in line with market forecasts.

Emirates NBD, Dubai’s biggest lender, fell 0.5 per cent. Logistics company Aramex gained 3.5 per cent after reporting on Wednesday a 26 per cent increase in second quarter profit.

Dubai’s main index closed down 0.2 per cent.

In Qatar, the index closed flat at 9,981 points with Commercial Bank losing 1.2 per cent and Qatari Investors Group rising 4 per cent.