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Sun 9 Sep 2012 10:11 AM

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Gulf seen positive; eyes on Fed meeting

Gulf markets are likely to open higher on Sunday with positive leads from global shares and Saudi Arabia

Gulf seen positive; eyes on Fed meeting

Gulf markets are likely to open higher on Sunday with positive leads from global shares and neighbouring Saudi Arabia supporting, but investors may be cautious as they wait for cues for further US monetary easing policy action.

US stocks gained on Friday as anaemic US jobs growth fuelled investor bets that the Federal Reserve will launch another round of monetary stimulus for the world's biggest economy.

The Fed starts a two-day policy meeting on Wednesday and markets will keenly await the US central bank's statement issued on Thursday and a media briefing by Chairman Ben Bernanke.

"Our markets, at least the UAE, should have a positive start but we have to focus in general on what's going to happen in the US and whether the Fed will start some quantitative easing," says Ali Adou, portfolio manager at The National Investor. "The affect on oil will be positive but we have to be careful because overall, the medium-term picture is not attractive globally."

Saudi Arabia's measure closed 0.8 percent higher, with petrochemical and banking stocks supporting.

Oil prices rose on Friday in volatile trading after a disappointing U.S. August jobs report bolstered expectations for stimulus, even while denting the outlook for petroleum demand.

Trading volumes have been thin in local bourses but are likely to pick up in the UAE as participants return after summer and schools reopen on Sunday.

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