Most stock markets in the Gulf ended higher on Monday after Federal Reserve Chair Jerome Powell signalled the U.S. central bank will most likely cut interest rates in September.

Powell on Friday endorsed an imminent start to interest rate cuts, saying further cooling in the job market would be unwelcome and expressing confidence inflation was within reach of the Fed’s 2% target.

U.S. personal consumption and core inflation data are due on Friday. Analysts are expecting the data to be benign enough to allow for rate cuts next month.

Fed fund futures are fully priced for a quarter-point cut at the Sept. 18 meeting, and imply a 38% chance of an outsized move of 50 basis points. The market also has 103 basis points of easing priced in for this year and another 122 basis points in 2025.

Monetary policy in the six-member Gulf Cooperation Council (GCC), including the UAE, is usually guided by the Fed’s decisions, as most regional currencies are pegged to the U.S. dollar.

The Qatari benchmark advanced 1.2%, with the Gulf’s biggest lender Qatar National Bank closing 2% higher.

Gulf markets gain on hopes of early US Fed rate cut

Qatar agreed on Monday to supply Kuwait with 3 million tons per annum (mtpa) of liquefied natural gas (LNG) for 15 years, the second such deal since 2020 as Kuwait imports the fuel to help meet rising demand for power generation.

Dubai’s main share index gained 0.8%, led by a 1.6% rise in blue-chip developer Emaar Properties.

In Abu Dhabi, the index eased 0.2%.

Saudi Arabia’s benchmark index finished flat.

Oil prices - a catalyst for the Gulf’s financial markets - rose nearly 3% on reports of a near total production stoppage in Libya, adding to earlier gains on concerns that escalating conflict in the Middle East could disrupt regional oil supplies.

Outside the Gulf, Egypt’s blue-chip index rose 0.2%, helped by a 6.4% gain in EFG Holding.

------------------------------------------- SAUDI ARABIA     was flat at 12,261 ABU DHABI        fell 0.2% to 9,356 DUBAI            gained 0.8% to 4,325 QATAR            advanced 1.2% to 10,223 EGYPT            rose 0.2% to 30,134 BAHRAIN          eased 0.1% to 1,929 OMAN             added 0.2% to 4,697 KUWAIT           increased 0.5% to 7,7989-------------------------------------------