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Gulf stocks rally on Saudi Arabia, Qatar talks – business news

Middle East stocks rallied after Saudi Arabia and Qatar said they were making progress toward ending a three-year long rift, providing the latest spur to a region being buttressed by a jump in oil prices and improved investor sentiment toward emerging markets.

Qatar’s benchmark QE Index gained as much as 1.8%, with all but one of its 20 members rising. Equities gauges in Dubai and Abu Dhabi also climbed as trading resumed after a holiday in the United Arab Emirates.

Shares in Doha had slumped in 2017 after countries including Saudi Arabia and the United Arab Emirates severed ties with the gas-rich nation. Qatar’s Foreign Minister said on Friday his country is “hopeful that things will move in the right direction,” and his Saudi counterpart said he was looking forward to a successful outcome to talks mediated by the US and Kuwait.

Progress in talks between the two countries comes amid increased investor appetite for riskier assets, driven largely by signs of further progress towards the rollout of coronavirus vaccines and optimism over a potential breakthrough in US stimulus talks. Oil prices have also rallied after support from an OPEC+ deal.

A potential reconciliation between Qatar and Saudi Arabia adds a positive note to the market, said Harshjit Oza, the head of research at Shuaa Securities in Abu Dhabi. He said the positive trend for oil prices and possible US stimulus should further support stocks in the region this week.

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