DUBAI: Gulf markets fell on Wednesday, tracking global peers, as investors brace for a possible Democrat win in the US Senate run-off election in Georgia that could help President-elect Joe Biden push for greater corporate regulation and higher taxes.
The prospects of a victory for Democrats in both races in Georgia, handing them control of the chamber, along with their narrow majority in the House of Representatives jointly could usher in large fiscal stimulus.
The developments in US Senate elections overshadowed gains in oil prices as crude rose to its highest since late-February after Saudi Arabia announced a big voluntary production cut, and as an industry report showed US inventories fell last week.
Saudi Arabia pledged additional, voluntary oil output cuts of one million barrels per day (bpd) in February and March as part of a deal under which most OPEC+ producers will hold production steady in the face of new coronavirus lockdowns.
Saudi Arabia’s benchmark index finished the session 0.1% lower. Samba Financial Group shed 0.5%, while oil behemoth Saudi Aramco edged down 0.1%.
The Dubai index finished 0.1% lower, its first fall in four sessions.
Emirates NBD was the top loser on the benchmark, declining nearly a percent, while Air Arabia shed 2.2%.
The Abu Dhabi’s benchmark closed 0.3% lower, its first losing session in the week.
The index was dragged by First Abu Dhabi Bank and Etisalat, which fell 0.3% and 0.4%, respectively.
In Qatar, the index closed 0.4% down, a day after it saw its biggest gain in nearly a month following the easing in the country’s rift with some Gulf countries.
Qatar’s economy will grow 3% as the easing of a three-year-old regional dispute will help trade, tourism, and logistics, Standard Chartered said, revising its previous 2.1% growth estimate.
Outside the Gulf, Egypt’s blue-chip index bucked the trend, gaining 1.1%.
Egypt kept domestic fuel prices unchanged under a quarterly pricing mechanism that links energy prices to international markets, the petroleum ministry said.