Most major stock markets in the Gulf rose in early trade on Thursday, buoyed by hopes for a potential ceasefire deal between Israel and Hezbollah.

Lebanon’s prime minister expressed hope on Wednesday that a ceasefire deal with Israel would be announced within days as Israel’s public broadcaster published what it said was a draft agreement providing for an initial 60-day truce.

The push for a ceasefire for Lebanon is taking place alongside a similar diplomatic drive to end hostilities in Gaza. Saudi Arabia’s benchmark stock index gained 0.2%, with ACWA Power Company advancing 3.9% and aluminium products manufacturer Al Taiseer Group up 0.2%.

Riyadh Air, the kingdom’s newest airline, said on Wednesday it had placed an order for 60 Airbus narrowbody A321-family jets as it prepares to start operations in 2025.

Dubai’s main share index edged 0.1% higher, with Emirates Central Cooling Systems Corp rising 2.4%.

The Qatari benchmark added 0.4%, led by a 1.9% rise in petrochemical maker Industries Qatar.

Most Gulf markets gain on earnings; geopolitics weigh

Oil prices - a catalyst for the Gulf’s financial markets - extended a rally from Wednesday, helped by US fuel demand following an unexpected drop in crude and gasoline inventories.

Manufacturing activity in China, the world’s biggest oil importer, expanded in October for the first time in six months, suggesting that stimulus measures are having an effect.

In Abu Dhabi, the stock index eased 0.2%.