Weak oil prices and the prospect of a US interest rate hike in December may dampen stock markets in the Middle East on Sunday.
Oil prices fell as much as 2 percent on Friday, with Brent ending below $48 a barrel. Meanwhile, short-term US bond yields rose to their highest in five years after very strong US jobs data for October boosted the likelihood that the Fed will raise rates before year’s end.
Money market rates have already been rising in the Gulf as liquidity shrinks because of lower oil revenues, and higher US rates could intensify the simultaneous fiscal and monetary squeeze in the region – with a particularly negative impact on real estate stocks.
