Sept 11 (Askume) – Major Gulf stock markets fell in early trade on Wednesday on weak oil prices, while investors awaited key U.S. inflation data that could signal a possible rate cut by the Federal Reserve next week, giving a bearing on the scale of the Fed’s rate cuts.
OPEC on Tuesday lowered its forecast for global oil demand growth in 2024 , reflecting data so far this year, and also lowered its forecast for next year, the producer group’s second consecutive cut.
The main reason for this decline is China, with OPEC cutting its 2024 production forecast from 700,000 barrels per day to 650,000 barrels per day. OPEC says oil use in the world’s second-largest economy is facing economic challenges and a shift to cleaner fuels.
Oil prices stabilized after falling more than 3% on Tuesday but remained near three-year lows after OPEC+ cut demand forecasts for this year and 2025 .
Brent crude futures were up 0.43% at $69.49 a barrel.
Saudi Arabia’s benchmark index (.TASI) fell 1%, led by Al Taceer Group.Bank (4143.SE) fell 0.7% and Al Rajhi Bank (1120.SE) fell 1.3% .
Elsewhere, oil giant Saudi Aramco (2222.SE) fell 0.3%.
Investors will now eye the US Labor Department’s Consumer Price Index report on Wednesday for policy cues, though the Federal Reserve has made it clear its focus is more on employment than inflation.
While the Fed is widely expected to cut interest rates next week, the extent of the reduction remains controversial, especially after Friday’s mixed labor report and it remains unclear which central bank action will be taken.
Dubai’s main stock index (.DFMGI) fell 0.8%, while Emirates National Bank (ENBD.DU) dropped 1%.
The Abu Dhabi index (.FTFADGI) fell 0.7%.
However, NMDC Energy (NMDCENR.AD) rose as much as 20% in early trade.
Qatar’s benchmark index (.QSI) fell 0.2%, while Qatar Gas Transport Co.(QGTS.QA) fell 1.6% .
