Dubai’s benchmark stock index surged to its highest level in more than a decade on Thursday, while most other markets in the Gulf were muted as investors braced for fewer rate cuts by the U.S. Federal Reserve next year.

The Dubai index rallied for a third straight session, up 0.6% at 5,112, its highest in 10 years and three months. Dubai Electricity and Water Authority rose 1.5% and Emaar Development advanced 2%.

Shuaa Capital climbed 5.4% to hit its highest in nearly four months. The investment bank’s board on Friday approved a deal with a senior creditor to restructure 208 million dirhams ($56.64 million) in debt facilities.

The Dubai index is on track to post a fourth consecutive annual gain, surging 25.9% this year, its biggest jump since 2021.

“Dubai’s solid fundamentals and diversified economic structure place it in a unique position compared to other GCC economies,” said Hani Abuagla, senior market analyst at XTB MENA.

“Prospects for further market growth are high on strong projections and new IPO activities next year.”

The Qatari benchmark index slipped for a fourth straight session, ending 0.5% lower. Qatar National Bank dropped 1.2% and Ooredoo lost 1.3%.

Dubai outperforms other Gulf markets in early trade

Saudi Arabia’s benchmark stock index was down for a third straight day, falling 0.3%. Oil giant Saudi Aramco shed 0.3% and Saudi Industrial Investment dropped 2.7% after its board proposed a capital decrease and no dividend for second half of 2024 and first half of 2025.

The Abu Dhabi benchmark index eased 0.4%, pressured by a 1% decline in conglomerate International Holding and a 0.7% drop in First Abu Dhabi Bank.

Since Fed Chair Jerome Powell primed markets for fewer rate cuts next year, traders are now pricing in just about 35 basis points worth of easing for 2025.

The Fed’s decisions have a significant impact on the Gulf region’s monetary policy, as most currencies there are pegged to the U.S. dollar.

Outside the Gulf, Egypt’s blue-chip index fell 0.2%, weighed down by a 0.9% drop in Commercial International Bank and a 2.1% loss in El Sewedy Electric.

-------------------------------------- SAUDI ARABIA     down 0.3% to 11,859 KUWAIT           up 0.1% to 7,870 QATAR            fell 0.5% to 10,413 EGYPT            down 0.2% to 29,958 BAHRAIN          ended flat at 1,986 OMAN             lost 0.3% to 4,468 ABU DHABI        fell 0.4% to 9,377 DUBAI            rose 0.6% to 5,112--------------------------------------