After the major OPEC news last week, oil reacted positively and broke the USD 52 mark; however over the weekend, with news coming from Russia that there will not be any deals with OPEC in its upcoming meeting in Istanbul, oil shied back to trade below USD 50. Global markets also responded negatively to the news and closed lower Friday said the Al Masah Weekly report
Despite the high correlation between oil prices and regional markets, most of the regional markets did not follow the same path as oil. Negative sentiment among investors regarding macroeconomic conditions is drowning out any positive from the oil rise so most of the regional indices ended the week in the red.
UAE Markets were the worst performers among their peers - Dubai ended the week lower by 3.45%, followed by Abu Dhabi by - 1.94%. On the other hand, Egypt led the winners over the week, going up by 6.18%, as investors increasingly believe devaluation is around the corner. Saudi Arabia also ended the week with a modest increase of 0.14% with investors buying dips, on a hope to make capital gains once the market follows the upward trend of oil which it usually does.
In the coming week oil prices and macro news will remain the main drivers for regional markets’ movements as investors both position themselves for a year-end rally or move to the sidelines and stay in cash.