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Investors should be cautious over Gulf tensions

Investors should be cautious over Gulf tensions
Traders at Dubai's bourse

By: Mahmoud Gamal

Dubai – Mubasher: Investors should be cautious in trading in the GCC stock markets especially after Saudi Arabia, Bahrain, Egypt, and the UAE cut their diplomatic ties with Qatar over political tensions, and anticipate the impact of the London Bridge attack on global stocks, analysts told Mubasher.

Most stocks are near important support levels that will not enable them to attract liquidity on the short-term, analysts added.

Gulf bourses are expected to see a volatile session, amid a decline in trading volume in line with an exacerbating political crisis between Qatar and the other four Arab countries led by Saudi Arabia, technical analyst Gamal Saeed told Mubasher.

The stock markets may lose the gains they tried to maintain in the past period, Saeed added.

Most investors will prefer to shy away from trading until the vision gets clearer to them, capital market analyst Salam Saeed said.

The GCC stocks will see important resistance levels throughout the rest of this week, amid expectations that the global stocks will also be weighed down by the latest London attack, according to Mohamed Radwan, a member of the International Federation of Technical Analysts.

On Saturday, seven people died and nearly 50 were injured in an attack on London Bridge.

The Saudi Stock Exchange (Tadawul) is expected to continue to rise and target 8,000-8,250 points, Radwan added.

Commenting on Dubai’s bourse, Radwan said that traders should decrease their positions until the market ends its downtrend which may lead its main index to approach 2,300-2,500 points.

Abu Dhabi’s stock market is likely to see a sideways-to-bullish performance, with expectations to rise to 4,350-4,450 points, Radwan said, adding that investors should keep their stocks in the medium-term until the index breaks above 4,700 points.

Kuwait’s main index is moving sideways between 6,500 and 6,600 points, he concluded.

Translated by: Julian Nabil