Saudi leads Gulf bourses lower on recession worries

Saudi leads Gulf bourses lower on recession worries

Saudi Arabia's stock market tumbled on Sunday, leading declines across Middle East, in response to Friday's fall in energy prices and on fears that aggressive interest rate hikes by major central banks to tame inflation could cause a global recession.

On Friday, MSCI's world stocks index shed 2.07% to almost two-year lows. The pan-European STOXX 600 index closed down 2.34%, its biggest weekly loss in three months.

Saudi Arabia's benchmark index, which traded after a session's break, slid 2.6%, marking its biggest intraday fall since late-June, weighed down by selling across the board.

Retal Urban Development Co dropped 4%, while oil behemoth Saudi Aramco finished 2.6% lower. Crude prices, a key catalyst for the Gulf's financial markets, plunged about 5% to an eight-month low on Friday as the U.S. dollar hit its strongest level in more than two decades and on fears rising interest rates will tip major economies into recession, cutting demand for oil.

The Saudi index remains exposed to additional price corrections with oil demand expected to continue slowing down, said Daniel Takieddine, CEO MENA BDSwiss.

The energy index in Saudi Arabia was down 2.7%. However, Hail Cement surged more than 8%, its biggest intraday gain since Dec. 2021, on acquisition talks with