Mideast Stocks: Qatar bourse leads declines in Gulf on volatile oil, hawkish Fed fears

Mideast Stocks: Qatar bourse leads declines in Gulf on volatile oil, hawkish Fed fears

Qatar's stock market led declines in much of the Gulf region on Tuesday amid volatile energy prices, while concerns about a prolonged rate-hiking cycle by the U.S. Federal Reserve kept investors at bay.

Data released on Monday showed U.S. services industry activity unexpectedly picked up in November. After a robust U.S. payrolls report on Friday, that raised doubts about whether the Fed would go for smaller hikes in interest rates just yet.

Most Gulf Cooperation Council countries, including Saudi Arabia, the United Arab Emirates and Qatar, have their currencies pegged to the U.S. dollar and follow the Fed's policy moves closely, exposing the region to a direct impact from monetary tightening in the world's largest economy.

In Qatar, the index tumbled 2.6%, underperforming Gulf peers as almost all the stocks on the index fell, including the Gulf's biggest lender Qatar National Bank, which retreated 4.9%.

The Qatari stock market was hit by sharply lower natural gas prices, which are reacting to expectations of a milder winter, said Farah Mourad, senior market analyst at XTB MENA.

"The main index could extend its losses under these conditions," Mourad said.

Dubai's main share index dropped 0.4%, ending a three-day winning streak, hit by a 0.9% fall in sharia-compliant lender