Stock markets in the United Arab Emirates edged higher on Friday as investor sentiment was bolstered by encouraging U.S. inflation data and expectations of a rate cut by the Federal Reserve.

The sharp turnaround in sentiment came after a batch of U.S. data this week showed inflation moderating but retail spending was robust.

Monetary policy in the six-member Gulf Cooperation Council (GCC), including the United Arab Emirates, is usually guided by Fed policy decisions because most regional currencies are pegged to the U.S. dollar.

As for lingering geopolitical risks, negotiators were to meet in Qatar again on Friday seeking a Gaza ceasefire agreement that could help avert a regional escalation, end a war that has killed tens of thousands of Palestinians and free Israeli hostages held by Hamas.

In Dubai, the main share index rose 0.6% to settle higher for a third session in a row, with Emirates NBD Bank edging up 0.3% and Watania International Holding surging 14.3% after reporting quarterly profit on Thursday.

Most Gulf markets in black on US rate-cut hopes

Blue-chip developer Emaar Properties, however, was down 1.8%.

Abu Dhabi’s benchmark index also rose for a third session, adding 0.5%, with conglomerate International Holding Company up 0.9% and ADNOC Distribution up 2.6%.

ADNOC Gas fell 1.6% as stock traded ex-dividend.

On a weekly basis, Dubai’s index was down 0.2% while Abu Dhabi’s was up 1.4%.

------------------------------------------ ABU DHABI    rose 0.5% to 9,286 points DUBAI        was up 0.6% to 4,243 points------------------------------------------