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MIDEAST STOCKS-Doha may firm on no new sanctions; sharp oil drop may hurt Gulf
July 6, 2017 / 5:46 AM / 4 months ago

MIDEAST STOCKS-Doha may firm on no new sanctions; sharp oil drop may hurt Gulf

DUBAI, July 6 (Reuters) - Qatar’s stock market may rise on Thursday after four Arab states decided for now not to slap fresh sanctions on Doha, while a sharp overnight fall in oil prices may weigh on Gulf bourses in general.

After meeting in Cairo, Saudi Arabia, the United Arab Emirates, Egypt and Bahrain refrained from announcing further sanctions against Qatar but voiced disappointment at its “negative” response to their demands, and said their boycott of Doha would continue.

“This is not good news, but it was expected and markets I think will be neutral because of the ongoing political stand-off,” said a regional equities fund manager.

The index is down 10 percent since June 5, when the diplomatic crisis erupted. Fund managers believe further sanctions, such as a pull-out of bank deposits, remain quite possible in coming days or weeks, but they may hurt the Qatari economy rather than cripple it.

The Saudi stock index may fall for a third straight session as investors book profits on last month’s gains and after Brent crude oil tumbled 3.7 overnight. It has since recovered slightly, trading 0.7 percent higher at $48.14 a barrel.

Steel and cement companies may get a boost, however, after the government said it would cancel all export duties on steel for two years to encourage local industries, and slash cement export tariffs by 50 percent. This could help building materials producers hurt by the construction industry slump. (Reporting by Celine Aswad; Editing by Andrew Torchia)

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