Gulf Markets Turn Mixed as Investors Weigh U.S.-Iran Diplomacy and Hormuz Risks
Gulf Markets Turn Mixed as Investors Weigh U.S.-Iran Diplomacy and Hormuz Risks
Gulf stock markets finished mixed on Thursday as investors assessed diplomatic efforts involving Iran and Qatar while continuing to watch developments around the Strait of Hormuz.
Dubai’s main index rose 0.3%, while Qatar’s benchmark gained 0.2%. Abu Dhabi was little changed, while Saudi Arabia’s index fell 0.2%, ending a seven-session run of gains.
The moves came as Qatar stepped up mediation efforts with Iran and discussions focused on restoring more normal shipping through the strategic waterway.
Gulf Stock Markets React to Iran Diplomacy
Qatar’s Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani travelled to Tehran on Thursday as part of efforts to revive diplomacy.
Qatar and Iran discussed a proposed phased framework that includes a temporary Iranian-Omani shipping corridor through the Strait and cooperation on clearing mines from the waterway, according to Qatar’s foreign ministry.
The diplomatic activity offered some relief to investors because a more stable shipping environment would reduce risks to energy supplies, freight movements and regional business activity.
However, the situation remains uncertain. The United States has stepped back from direct negotiations with Tehran and has instead pursued increased economic pressure on Iran.
Dubai Stocks Rise 0.3%
Dubai’s benchmark index gained 0.3%, with most sectors ending higher.
Emirates NBD, Dubai’s largest lender, rose 1.2%, while toll-road operator Salik Company advanced 1.3%.
The gains came despite the continued uncertainty around shipping through Hormuz, an important consideration for Dubai because of the emirate’s exposure to trade, logistics, tourism and financial services.
Qatar Stocks Gain 0.2%
Qatar’s benchmark added 0.2%, supported by materials and energy stocks.
Gulf International Services jumped 6%, while Qatar Gas Transport gained 1.1%.
QatarEnergy also issued a spot tender to sell light and full-range naphtha cargoes from Ras Laffan, a major energy hub near the Strait of Hormuz.
The energy activity comes as investors continue to monitor whether the waterway can return to more normal operating conditions.
Saudi Stocks End Seven-Day Winning Streak
Saudi Arabia’s benchmark index slipped 0.2%, bringing an end to seven consecutive sessions of gains.
Al Rajhi Bank and Saudi Arabian Mining Co. were among the stocks weighing on the index.
The decline was relatively modest, but it marked a pause in the market’s recent advance as investors assessed both regional developments and the broader economic outlook.
Abu Dhabi Market Holds Steady
Abu Dhabi’s benchmark was little changed.
ADNOC Gas declined 1.2%, while First Abu Dhabi Bank rose 1.1%.
The mixed performance of major companies kept the wider index broadly stable despite continued uncertainty surrounding regional trade routes.
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Strait of Hormuz Shipping Remains a Key Risk
The latest shipping data show why investors remain cautious.
Only seven commodity vessels transited the Strait of Hormuz on Thursday, according to preliminary data from ship-tracker Kpler. That compared with 17 vessels on Wednesday and a 10-day average of 15.
The seven vessels included two medium-range tankers, one very large gas carrier, one Ultramax vessel, one intermediate tanker and two chemical tankers. Four vessels exited the strait while three entered.
The numbers can change as ships with transponders switched off are identified, but the latest reading still shows traffic well below the recent average.
That matters far beyond Gulf markets. The Strait is a critical route for global energy shipments, meaning prolonged disruption can raise transportation costs and increase pressure on oil and gas markets.
Iran Signals Conditions for Normal Shipping
Diplomatic efforts have increasingly focused on reopening the waterway.
Reuters reported on Friday that Iran had agreed to draw up a list of conditions for restoring normal traffic after Qatar’s emissary pressed Tehran to respect freedom of navigation. Iran and Oman are also working on arrangements concerning the management and revenues associated with the waterway.
A return to normal shipping would remove one of the largest immediate sources of uncertainty for regional energy and logistics markets.
But investors still have to account for the possibility that negotiations fail or that restrictions on maritime traffic persist.
What the Hormuz Risk Means for Gulf Markets
Thursday’s market performance shows that investors are not responding to the geopolitical situation uniformly.
Dubai and Qatar posted modest gains, Abu Dhabi was broadly unchanged and Saudi Arabia pulled back after seven consecutive advances.
The common factor is the Strait of Hormuz, but each market has different exposure to energy, banks, logistics, real estate and domestic economic activity.
For now, the market reaction is being driven less by the announcement of a definitive agreement and more by expectations that diplomatic efforts could eventually improve shipping conditions.
That makes the next developments around Hormuz particularly important for Gulf equities, energy prices and regional trade.
Until shipping activity moves closer to normal levels and a durable diplomatic arrangement emerges, investors are likely to continue treating the Strait as a major source of market risk.
Source: Qatar News Agency
