Qatar stocks slump after UAE, Saudi cut ties; oil rises

Qatari equities slumped on Monday after three Gulf Cooperation Council (GCC) states decided to cut diplomatic relations with the country.

Oil prices, meanwhile, edged higher as political tensions in the Gulf region escalated.

“The potential for political risk (was) something that was not priced into the regional (financial) markets beforehand and has resulted in the stock markets being caught off-guard,” Jameel Ahmed, vice president of market research at brokerage firm FXTM, said.

Qatar’s benchmark QE Index fell 7.3 percent at 9,203 points. All 44 stocks were down, with a number of them hitting the 10 percent floor.

Banking sub-index plunged 6.8 percent, with Qatar National Bank down 6.1 percent at QAR 136.5 and Masraf Al Rayan down 9.9 percent to QAR 40.5.

Industrial stocks also took a beating as Industries Qatar dropped down 6.3 percent to reach QAR 97.5.

Qatar First Bank, Gulf International, Nakilat, and Gulf Warehousing lost 10 percent each.

In the United Arab Emirates (UAE), Dubai’s benchmark index recovered slightly from early session drop to close lower by 0.7 percent at 3,317 points. The index had fallen 1.2 percent earlier in the day.

UAE, Saudi Arabia and Bahrain have decided to sever ties with Qatar, citing concerns over security and accusing Qatar of creating instability in the region.

Meanwhile, oil prices edged higher. Global benchmark Brent crude was last trading up 0.3 percent at $50.09 per barrel (bbl), while WTI crude gained 0.4 percent to reach $47.85/bbl.

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com