Gulf markets hold steady despite US entry into Israel-Iran war
Gulf stock markets held steady on Sunday after the US struck three nuclear sites in Iran in overnight attacks, escalating the Israel-Iran war that threatens to disrupt energy supplies from the oil-rich region.
Saudi Arabia's Tadawul gave up early gains and its main index ended traded 0.34 per cent lower. Qatar's main index closed up 0.19 per cent, while the main market in Kuwait ended the session 1.81 per cent higher on Sunday.
Bahrain's bourse closed up 0.27 per cent, while the main index on the Muscat bourse reversed early losses to end 0.42 per cent higher.
"Markets are focused on whether the war spreads to other countries and there is no evidence of that as yet," Hasnain Malik, head of emerging and frontier market investment strategy at Tellimer, told The National. "The benign interpretation is that the US intervention will accelerate the end of the war. That, of course, remains to be seen."
Investor attention is now centred on the risk of Iranian retaliation, particularly towards US assets, regional energy infrastructure, and maritime routes like the Strait of Hormuz and the Red Sea, Iridium Advisor said in a note on Sunday morning.
" GCC investor sentiment will be shaped by rising geopolitical risk following US air strikes on Iranian nuclear sites," it said.
"While broad financial disruption appears unlikely, markets will monitor liquidity conditions. For now, the market impact will hinge more on the nature and timing of Tehran's response than the strikes themselves."
Meanwhile, the Tel Aviv stock market also gained on Sunday, with the TA-125 index up 0.98 per cent and TA-35 up 0.75.
The US military bombed three nuclear sites in Iran, President Donald Trump said on Saturday night, calling the attacks a "spectacular military success".
"Iran's key nuclear enrichment facilities have been completely and totally obliterated," he said.
He also warned of the possibility of further attacks, saying there were "many targets left".
"Iran, the bully of the Middle East, must now make peace. If they do not, future attacks will be far greater and a lot easier."
Iran retaliated on Sunday morning with about 25 missiles, authorities said.
The war, which began on June 13 following air strikes by Israel on Tehran, has rattled investors.
The UAE markets ended higher last week, with the Dubai Financial Market up 1.5 per cent at the close of session and the Abu Dhabi Securities Exchange gaining 0.95 per cent at market close.
Global stocks ended last week on a mixed note, with both the S&P 500 and the Nasdaq composite ending the session on Friday lower, while the Dow Jones Industrial Average closed slightly higher.
In Europe, London's FTSE 100 closed 0.2 per cent lower, while Paris' CAC 40 gained 0.5 per cent. Frankfurt's DAX was up 1.3 per cent.
In Asia, Hong Kong's Hang Seng index edged 1.3 per cent higher and Shanghai's composite was down 0.07 per cent, with Japan's Nikkei down 0.2 per cent.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The National
an hour ago
- The National
Israel-Iran war could slow Gulf investment inflow in 2025, warns World Bank regional chief
Foreign direct investment in the Gulf could slow in the second half of this year as the war between Iran and Israel dents investor sentiment, the World Bank 's director for the region has said. Investors will probably adopt a wait-and-see approach as the conflict that started with Israel's attacks on Iran's nuclear sites on June 12 worsens, Safaa El-Kogali told The National in Riyadh. 'Even if they've started [investing beforehand], they [foreign investors] might hold off until they see things settling down a bit,' she said on the sidelines of a World Bank seminar on Sunday. De-escalation does not seem likely after President Donald Trump ordered the first-ever direct US military attack on Iranian soil earlier that day. The US attacked three Iran nuclear facilities with six bunker-buster bombs and launched Tomahawk missiles. GCC countries had varied in their ability to attract FDI in 2024. The UAE received Dh167 billion ($45.5 billion) in foreign direct investment last year, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, said in a post on X on Thursday. This represented a 48 per cent increase, he added. The UAE accounted for 37 per cent of the total foreign investment flows in the region, he said. Saudi Arabia's net FDI inflows in 2024 decreased as a share of GDP, amounting to 1.1 per cent compared to 2.1 per cent in 2023, according to a recent report by the World Bank. Bahrain, Kuwait, and Qatar saw FDI fall by 7.3 per cent, 2.3 per cent and 0.5 per cent of GDP respectively from 2023 to 2024, it added. Oman saw FDI increase by 2.4 per cent of GDP. This was due to 'prudent fiscal management and diversification efforts' the report said. What is the impact? No one can accurately measure the impact of the escalation on the regional economies, but peace is necessary for economic security and the implications will be broad, Ms El-Kogali said. 'Increasing costs of commodities, of shipments – this will impact a number of industries that import raw material', she said. The conflict will add to inflation, which will affect investors and consumers alike, she added. 'Whenever there is uncertainty … in any region, tourists usually decide not to go,' she said. Travel and tourism made up about 11.4 per cent of the region's gross domestic product in 2024, according to the latest data from the Statistical Centre for the Co-operation Council for the Arab Countries of the Gulf. Oil prices, which have surged since the beginning of the war, will also have an impact on the fiscal balance of Gulf countries that still rely heavily on oil as their primary source of revenue and exports, she said. Brent and WTI surged by as much as 13 per cent in the first few hours of trading after Israel began its military campaign against Tehran. Oil prices posted a third weekly gain in a row despite falling on Friday as the war sparked supply fears. On Friday, Brent, the benchmark for two thirds of the world's oil, fell 2.33 per cent to settle at $77.01 a barrel. West Texas Intermediate, the gauge that tracks US crude, closed 0.28 per cent lower at $74.93 a barrel. Who will feel it more? Gulf countries that have diversified away from oil, such as the UAE, are more likely to resist hits caused by global economic uncertainty, Ms El-Kogali said. This was a key message of the World Bank report, Smart Spending, Stronger Outcomes: Fiscal Policy for a Thriving GCC, released last week, that measured the growth of Gulf economies until June 1. 'I think this report is really timely, because it focuses on what the GCC countries have been doing, and what impact, or the effect, those policies that have been put in place [have had],' said Ms El-Kogali. 'The UAE has started the diversification agenda a while back and currently, with 74 per cent of GDP being from the non-oil sector, puts them in a stronger position. 'The more you diversify, the more you have different opportunities to deal with crises that come your way. When you put all your eggs in one bag, and something happens to that bag, then you're in greater trouble.' Proper investment Ms El-Kogali said that higher oil prices can benefit Gulf countries, depending on how revenue is spent in the non-oil sector. 'We think that as the non-oil sector continues to be strong and growing, with the easing off of the oil production cuts, that the countries of the GCC have good gross prospects in the short and medium term,' she said. 'We really expect growth to reach 4.5 per cent by 2026 driven by the oil and the non-oil.' It takes time to see the returns of investments she added. This growth is particularly important during period of geoeconomic uncertainty. However, 'there may be the risk of spillovers' of the war which will impact the growth trajectory of Gulf nations, she said. Gulf countries have been prudent in the past during crises and 'we saw that implementing fiscal spending during downturns had a positive impact', she said. There is room to do more to further streamline spending and the Gulf countries must prioritise investments that have high returns, and can create jobs during difficult times, that will then sustain growth through economic cycles, she added.
Arabian Business
2 hours ago
- Arabian Business
Israel-Iran conflict: UAE, Kuwait, Bahrain, Oman, Qatar call for dialogue following US strikes on nuclear facilities
The United Arab Emirates (UAE), Kuwait, Bahrain, Oman, Qatar, and the Gulf Cooperation Council (GCC) have issued separate statements expresseing concern following the United States' confirmed strikes of three Iranian nuclear facilities – an action described by US President Donald Trump as a ' successful ' strike in coordination with Israel. The operation, which marks a significant escalation in the conflict between Iran and Israel, has prompted regional calls for restraint and diplomacy. The UAE called for immediate de-escalation and emphasised the importance of diplomacy to prevent further regional instability. It also appealed to the United Nations and the Security Council to act responsibly in addressing the crisis. Kuwait 'expressed its deep concern,' and reaffirmed its condemnation of actions against Iran's sovereignty and called for political solutions. Bahrain echoed this sentiment, encouraging peace talks between the US and Iran. Oman condemned the US strikes, calling them a violation of international law, and highlighted the risk of radioactive contamination from attacks on nuclear facilities. Qatar further warned of 'catastrophic consequences' and urged all parties to exercise restraint. However, Saudi Arabia's Nuclear and Radiological Regulatory Commission confirmed no radiological effects had been detected within the Kingdom or other GCC countries. The Gulf Cooperation Council (GCC) also released a statement reiterating calls for de-escalation and diplomatic engagement. Secretary-General Jasem Mohamed Albudaiwi warned the situation threatens regional stability and emphasised the need for restraint from all sides. Iran nuclear sites hit by US bombers in major escalation In a joint air campaign dubbed Operation Midnight Hammer, US military officials confirmed the use of 125 aircraft, including seven B-2 stealth bombers. Among the targeted sites were the Fordo uranium enrichment plant, and facilities at Natanz and Isfahan. General Dan Caine, chairman of the joint chiefs of staff, said initial assessments indicated 'extreme damage and destruction' at all three sites, the BBC reported. The Fordo facility, located deep beneath a mountain south of Tehran, is considered critical to Iran's nuclear programme. Due to its depth, the US deployed GBU-57 Massive Ordnance Penetrators, or 'bunker buster' bombs, which weigh 13,000kg and are capable of penetrating deep layers of concrete and earth, the report said, adding fourteen such bombs were used in the strikes. Iranian officials have confirmed the strikes but claimed the damage was limited, saying key materials had been removed in advance. The Atomic Energy Organization of Iran described the attacks as a violation of international law. Within hours of the US strike, Iran launched retaliatory missile strikes targeting parts of Tel Aviv and Haifa, injuring at least 86 people. Iranian Foreign Minister Abbas Araqchi stated that Tehran reserves the right to respond, accusing President Trump of betraying earlier promises to avoid entanglement in Middle East conflicts, the report added. 'There are many targets left,' says US President Donald Trump President Trump addressed the nation flanked by senior officials, warning Iran of 'far greater' future strikes if a diplomatic resolution is not reached. He said, 'There are many targets left,' and stressed that the US action aimed to counter a growing threat. International reactions have varied. UK Prime Minister Sir Keir Starmer said the US took action to 'alleviate' the 'grave threat' posed by Iran's nuclear programme, and urged Iran to return to negotiations, in an X posst. Iran's nuclear programme is a grave threat to international security. Iran can never be allowed to develop a nuclear weapon and the US has taken action to alleviate that threat. The situation in the Middle East remains volatile and stability in the region is a priority. We call… — Keir Starmer (@Keir_Starmer) June 22, 2025 The United Nations Secretary-General António Guterres warned of dangerous escalation, while the EU urged all sides to resume talks. I am gravely alarmed by the use of force by the United States against Iran today. This is a dangerous escalation in a region already on the edge – and a direct threat to international peace and security. There is a growing risk that this conflict could rapidly get out of… — António Guterres (@antonioguterres) June 22, 2025 India and Russia also responded. Indian Prime Minister Narendra Modi called for dialogue, while Russian politician Dmitry Medvedev criticised the strikes, accusing Trump of igniting a new war. Spoke with President of Iran @drpezeshkian. We discussed in detail about the current situation. Expressed deep concern at the recent escalations. Reiterated our call for immediate de-escalation, dialogue and diplomacy as the way forward and for early restoration of regional… — Narendra Modi (@narendramodi) June 22, 2025 What have the Americans accomplished with their nighttime strikes on three nuclear sites in Iran? 1. Critical infrastructure of the nuclear fuel cycle appears to have been unaffected or sustained only minor damage. — Dmitry Medvedev (@MedvedevRussiaE) June 22, 2025 The crisis follows an Israeli attack on June 13 targeting Iranian nuclear and military sites. Iran responded with drone and rocket strikes, sparking a cycle of escalation. Although nuclear negotiations had been underway between the US and Iran, Trump's recent strikes came earlier than the two-week timeline he had previously indicated.
Zawya
2 hours ago
- Zawya
Saudia launches flights to Al Alamein and Salalah
Jeddah: Saudia, the national flag carrier of Saudi Arabia, has officially launched flights to Al Alamein in Egypt and Salalah in Oman. The new Al Alamein route marks Saudia's fourth destination in Egypt, which now operates three weekly flights from King Abdulaziz International Airport in Jeddah in each direction, in addition to three weekly flights from King Khalid International Airport in Riyadh. Saudia has also inaugurated flights from Jeddah to Salalah in Oman, marking the airline's second destination in the country following Muscat. The route operates with three weekly flights in each direction. Both new destinations are operated by Airbus A320 aircraft, renowned for their operational efficiency and onboard amenities, including comfortable seating and a wide range of in-flight entertainment options, designed to enhance the overall guest experience. Saudia continues this growth with a modern fleet of 147 aircraft and plans to add 118 more in the coming years. This expansion is complemented by innovative efforts to elevate guest experience, using advanced AI technologies and the latest developments in ground and in-flight services. -Ends- About Saudia: Saudia (Saudia Airlines) is the national flag carrier of the Kingdom of Saudi Arabia. Established in 1945, the company has grown to become one of the Middle East's largest airlines. Saudia has invested significantly in upgrading its aircraft and currently operates one of the youngest fleet, with 147 aircraft. The airline serves an extensive global route network covering around 100 destinations across four continents, including all 28 domestic airports in Saudi Arabia. A member of the International Air Transport Association (IATA) and the Arab Air Carriers Organization (AACO), Saudia has also been a member airline in SkyTeam, the second largest alliance, since 2012. Saudia was recently awarded the "World Class Airline 2025" for the fourth consecutive year at The APEX Official Airline Ratings™ awards. Saudia has also advanced 11 places in the Skytrax airlines ranking of the World Best Airlines 2023. The Airline also ranked top among global airlines for best on-time performance (OTP) according to a report by Cirium. For more information on Saudia, please visit
