Mideast Stocks: Most Gulf markets in black on Fed rate-cut optimism

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Most stock markets in the Gulf rose in early trade on Monday amid expectations of a U.S. rate cut in September, although heightened geopolitical tensions in the region limited gains.

The U.S. central bank's Federal Open Market Committee meets on July 30-31 and is expected to keep rates unchanged. However, recent softer data and comments from Fed officials have prompted the rate futures market to fully price in a 25 basis-point cut in September.

Monetary policy in the six-member Gulf Cooperation Council (GCC) is usually guided by the Fed's decisions as most regional currencies are pegged to the U.S. dollar.

Dubai's main share index <.DFMGI> gained 0.7%, led by a 2.6% rise in blue-chip developer Emaar Properties <EMAR.DU> and a 1.6% increase in top lender Emirates NBD <ENBD.DU>.

In Abu Dhabi, the index <.FTFADGI> finished 0.8% higher, with the country's biggest lender First Abu Dhabi Bank (FAB) <FAB.AD> advancing 6.3%.

Last week, FAB reported a second-quarter profit that beat estimates, helped by growth in both interest and non-interest income.

The Qatari benchmark <.QSI> added 0.3%, with Qatar Islamic Bank <QISB.QA> rising 0.9%.

Saudi Arabia's benchmark index <.TASI> dropped 0.4%, hit by a 0.7% fall in aluminium product manufacturer Al Taiseer Group <4143.SE>.

Investors also tracked the escalation in Middle East tensions.

Israel's security cabinet authorised Prime Minister Benjamin Netanyahu's government to decide on the "manner and timing" of a response to a rocket strike in the Israeli-occupied Golan Heights that killed 12 teenagers and children, which Israel and the United States blamed on Hezbollah. The Lebanese armed group has denied any role.

Outside the Gulf, Egypt's blue-chip index <.EGX30> declined 0.6%, weighed down by a 2.6% drop in Talaat Mostafa Group <TMGH.CA>.

Egypt raised the prices of a wide range of fuel products on Thursday, the official gazette said, four days before the International Monetary Fund (IMF) conducts a third review of its expanded $8 billion loan programme for the country.

SAUDI ARABIA	<.TASI> fell 0.4% to 12,121
ABU DHABI	<.FTFADGI> up 0.8% to 9,395
DUBAI	<.DFMGI> rose 0.7% to 4,308
QATAR	<.QSI> gained 0.3% to 10,170
EGYPT	<.EGX30> lost 0.6% to 28,851
BAHRAIN	<.BAX> was up 0.1% to 1,972
OMAN	<.MSX30> rose 0.5% to 4,652
KUWAIT	<.BKP> added 0.2% to 7,847