Mideast Stocks: Saudi bourse at 19-month low on growth fears; Egypt extends gains

Mideast Stocks: Saudi bourse at 19-month low on growth fears; Egypt extends gains

Saudi Arabia's stock market led declines in much of the Gulf region on Wednesday, hitting its lowest since April last year as worries mounted about a global economic downturn.

Data released on Monday showed U.S. services industry activity unexpectedly picked up in November, prompting investor speculation that the Fed could keep raising interest rates for longer which could hurt economic growth. Traders expect a half-point hike from the Fed on Dec. 14.

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.

Saudi Arabia's bechmark index declined 2.5%, hitting its lowest since April 2021, dragged down by a 4.9% slide in Al Rajhi Bank and a 4.7% fall in Riyad Bank. The Saudi bourse could see more losses while concerns remain around the developments in oil markets, Daniel Takieddine, CEO MENA at BDSwiss, said.

"However, the market could find some support in solid local fundamentals."

Oil - a key catalyst for the Gulf's financial markets - edged higher after Brent crude earlier fell close to its lowest this year, as hopes