Deal could reduce geopolitical tensions, encouraging more foreign portfolio investment throughout the region
Dubai's stock market led Gulf bourses higher in early trade on Sunday as investors reacted to Iran's deal with world powers on its disputed nuclear programme.
If confirmed in a final agreement by a June 30 deadline, the nuclear deal could eventually hurt Gulf economies to some degree by lifting international sanctions and allowing more Iranian oil onto the market, pushing down crude prices. Brent oil plunged nearly 4.0 percent on Thursday in an initial reaction to the deal.
But the agreement - if received positively by major Gulf Arab governments - could also reduce geopolitical tensions, encouraging more foreign portfolio investment throughout the region.
Dubai's economy in particular would probably benefit as the emirate became a jumping-off point for foreign companies and traders going back into Iran.
The main Dubai stock index climbed 1.6 percent in early trade on Sunday. Air Arabia, which could see increased business if transport links to Iran expand, surged 2.8 percent.
Property shares dominated activity in Dubai with DAMAC, the most active stock, surging 8.9 percent after the firm said it would consider taking an equity stake in a project to build a 50-storey mixed-use tower in central London - which would be its entry into the British market.
Shares in another likely beneficiary of an opening of Iran's economy, Kuwait logistics firm Agility, gained 1.3 percent. The Kuwait market index edged up 0.5 percent.
Abu Dhabi's market rose 0.7 percent, led by blue chip First Gulf Bank, up 1.4 percent, while Qatar edged up 0.3 percent.