Dubai hits over a decade high, most Gulf shares muted

Dubai’s benchmark share index jumped on Wednesday to its highest level in more than a decade, while most other markets in the Gulf were muted as investors braced for fewer rate cuts by the US Federal Reserve in the coming year.

Dubai’s benchmark stock index extended its gain to a second straight session, rising 0.6 per cent to 5,093, its highest in 10 years and three months.Emirates NBD, Dubai’s largest lender, rose 0.8 and Gulf Navigation advanced 1.3 per cent.

Shuaa Capital surged 5.5 per cent to its highest in over three months.The investment bank’s board approved on Friday a deal with a senior creditor to restructure 208 million dirhams ($56.64 million) in debt facilities.

Saudi Arabia’s benchmark stock index was down 0.2 per cent, with most sectors in the red. Saudi National Bank, the kingdom’s largest lender, fell 0.9 per cent and media giant MBC Group slipped 1.7 per cent.

Kingdom Holding surged 8.0 per cent in early trade after the conglomerate said it has acquired a stake worth 1.5 billion riyals ($400 million) in Elon Musk’s artificial intelligence start-up, xAI.The Abu Dhabi benchmark index was down 0.2 per cent, pressured by a 0.5 per cent drop in conglomerate International Holding falling 0.5 per cent and 1.1 per cent loss in Lulu Retail.

The Qatari benchmark index slipped 0.4 per cent with almost all stocks in negative territory.Qatar National Bank, the region’s largest lender, lost 0.5 per cent and Qatar Gas Transport slipped 1.0 per cent.

US central bank policymakers have lowered their rate cut projections for 2025 to 50 basis points, from 100 basis points, and increased their inflation forecast.Traders are pricing in just about 35 basis points 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 US dollar.