Askume, Sept 19 – Major stock markets in the Bay Area rose in early trade on Thursday as most of the region’s central banks cut key interest rates following the Federal Reserve’s looser-than-usual policy.
The Federal Reserve cut its benchmark interest rate by 50 basis points on Wednesday , and policymakers are expected to cut it by another half percentage point before the end of the year.
Saudi Arabia’s benchmark index (.TASI) rose 0.4%, while Al Rajhi Bank (1120.SE) added 1.1%.
The region’s largest economy cut its repurchase agreement rate and reverse repo rate by 50 basis points each to 5.5% and 5.0%, respectively, according to a central bank statement.
Among other gainers, oil giant Saudi Aramco (2222.SE) rose 0.6%.
Oil prices rose after Gulf financial markets read a US interest rate cut , but gains were limited as concerns about global demand persisted.
Dubai’s main stock index (.DFMGI) rose 0.5%, led by a 1.2% rise in blue-chip developer Emaar Properties (EMAR.DU).
The Abu Dhabi index (.FTFADGI) rose 0.2%.
The UAE Central Bank also reduced the benchmark interest rate for overnight deposit facilities by half a percentage point to 4.90%.
Monetary policy in the Gulf Cooperation Council (GCC) generally follows Federal Reserve decisions, as most regional currencies are pegged to the US dollar.
Qatar’s benchmark index (.QSI) rose 0.4%, led by a 0.6% rise in Qatar National Bank (QNBK.QA), the Gulf region’s biggest bank.
Qatar’s central bank on Wednesday cut its key interest rate by 55 basis points.
