Most Gulf Stock Markets Fall Amid US Rate Cut Uncertainty

Gulf stock markets have fallen amid growing doubts about further U.S. Federal Reserve interest rate cuts and disappointing corporate earnings. Despite a recent 25 basis point cut, Federal Reserve Chair Jerome Powell's cautious remarks have lowered the probability of additional cuts in December from over 90% to around 63-71%, according to CME's FedWatch Tool. This uncertainty affects Gulf economies significantly because their currencies are pegged to the U.S. dollar, making regional borrowing costs and investor sentiment highly sensitive to U.S. monetary policy shifts. Key Gulf markets, including Saudi Arabia, Qatar, Dubai, and Abu Dhabi, experienced declines, with major companies like Saudi Aramco, Al Rajhi Bank, and ACWA Power seeing stock price drops. Analysts warn that ongoing rate uncertainty and weak corporate earnings could prolong volatility and subdued market performance in the region. The situation underscores the close interconnection between global monetary policy and local Gulf economic conditions.