Stock markets in the Gulf ended lower on Thursday as mounting evidence of a U.S. economic slowdown fuelled worries about a possible global recession.

The U.S. services sector slowed more than expected in March as demand cooled, while a measure of prices paid by services businesses fell to the lowest in nearly three years.

Fed fund futures are indicating a 62.5% chance of the U.S. central bank pausing its rate hikes in May and a 51.3% chance of a rate cut at its July meeting, according to CME Group’s Fedwatch tool.

Most Gulf Cooperation Council countries, including Saudi Arabia, the United Arab Emirates and Qatar, have their currencies pegged to the U.S. dollar and follow the Fed’s policy moves closely, exposing the region to a direct impact from monetary tightening in the world’s largest economy.

Saudi Arabia’s benchmark stock index eased 0.1%, extending losses from the previous session, hit by a 1.3% decline in Retal Urban Development Co.

The Saudi bourse saw more price corrections as traders move to secure gains in the current uncertain atmosphere, said Fadi Reyad, chief market analyst at CAPEX.com.

Most Gulf markets decline as economic worries persist

“Global sentiment affected local stocks after U.S. economic data altered expectations.”

However, the index posted its third weekly gain of 3%. Earlier this week, the benchmark registered sharp gains after a surprise announcement by OPEC+ to further cut oil production.

Dubai’s main share index dropped 0.4%, with blue-chip developer Emaar Properties losing 1.4%.

Shares in UAE-based currency exchange company Al Ansari Financial Services climbed 16.5% above its listing price on its market debut.

In Abu Dhabi, the index retreated 0.3%, while the Qatari index fell 0.2%.

Outside the Gulf, Egypt’s blue-chip index tumbled 1.8%, as most of the stocks on the index were in negative territory.

The Egyptian market is coming under increasing pressure as risk aversion increases among investors on a global and local stage, Reyad said.

========================================== SAUDI ARABIA     eased 0.1% to 10,906 ABU DHABI        lost 0.3% to 9,471 DUBAI            dropped 0.4% to 3,415 QATAR            declined 0.2% to 10,342 EGYPT            fell 1.8% to 16,709 BAHRAIN          eased 0.1% to 1,886 OMAN             lost 0.9% to 4,756 KUWAIT           down 0.4% to 7,725==========================================