Most Gulf Markets Gain on US Debt Deal, Job Data

Dubai June 4 2023: Most stock markets in the Gulf ended higher on Sunday after the U.S. Congress passed a debt ceiling deal that averted a government default in the world’s biggest economy, while jobs data fuelled hopes for a possible pause in Fed rate hikes.

President Joe Biden on Saturday signed a bill that suspends the U.S. government’s $31.4 trillion debt ceiling, averting what would have been a first-ever default with just two days to spare.

Oil prices – a key catalyst for the Gulf’s financial markets – rose more than 2% on Friday after the U.S. debt deal and jobs data.

Saudi Arabia’s benchmark index (.TASI) advanced 1.9%, outperforming the region, buoyed by a 2.5% rise in Al Rajhi Bank (1120.SE) and a 3.8% increase in Riyad Bank (1010.SE).

Most Gulf Cooperation Council countries, including Saudi, have their currencies pegged to the dollar and generally follow the Fed’s policy moves, exposing the region to a direct impact from monetary tightening there.

In Qatar, the index (.QSI) finished 1.8% higher, with almost all the stocks closing in positive territory including Qatar Islamic Bank (QISB.QA), which gained 2.1%.

Outside the Gulf, Egypt’s blue-chip index (.EGX30) eased 0.4%, hit by a 0.7% fall in top lender Commercial International Bank (COMI.CA).

Saudi Arabia’s Milling Company 3 (MC3) is planning an initial public offering (IPO) next year and has invited banks to pitch for roles in the deal, Reuters reported on Thursday, citing two sources familiar with the matter.