DUBAI: Weak economic data from Saudi Arabia and the United Arab Emirates may restrain Gulf stock markets from any major rises on Tuesday, despite a better global environment for equities.
MSCI’s broadest index of Asia-Pacific shares outside Japan is up 1.3 percent after losing ground for five straight sessions. Overnight, the benchmark for U.S tech stocks hit its highest in 15 years.
But data released on Tuesday morning showed the seasonally adjusted Emirates NBD Saudi Arabia Purchasing Managers’ Index dropped last month to 55.7 – its lowest level since the survey was launched in August 2009 – from 56.5 in September.
The UAE October PMI fell to a 30-month low of 54.0 in October from 56.0. Both indexes suggested low oil prices are starting to dampen private sector activity in the Gulf.
Among individual Gulf corporate earnings, du, the UAE’s second biggest telecommunications operator, missed estimates with a 12.3 percent fall in third-quarter net profit to 489.8 million dirhams ($133.4 million). Two analysts polled by Reuters had on average forecast 521.3 million dirhams.
The latest PMI reading in Egypt was also disappointing; the index fell to an eight-month low of 47.2 in October from 50.2 in September, below the 50-point mark that separates growth from contraction.