Gulf Markets Dip After Iran Attacks Israel

Gulf markets were down slightly on Sunday, providing an early indication of investor reaction to Iran's unprecedented attack on Israeli territory, as reported by Federico Maccioni and Shamsuddin Mohammed for Reuters.

Saudi Arabia's benchmark stock index fell 1.8% in early trading, while the main Qatari index was down 1.6%, with Gulf lender QNB leading losses. I Photo: QNBFinansBank

Saudi Arabia's benchmark stock index fell 1.8% in early trading, while the main Qatari index was down 1.6%, with Gulf lender QNB leading losses. Shares in Tel Aviv's broad and blue-chip indices were flat to marginally lower in early trade.

Iran's retaliatory drone and missile attack in response to a suspected Israeli air strike raises the threat of wider regional conflict.

Israel reported modest damage, but the key for investors will be how the conflict unfolds from here.

"If it stays tit-for-tat instead of escalating, then we will likely see a sigh of relief across equities even if oil prices, gold, the dollar, and bonds all embed a risk premium to reflect the conflict," said Brian Jacobson, chief economist at Annex Wealth in Milwaukee, Wisconsin.

Brent crude futures rose 71 cents to $90.45 a barrel on Friday, with prices last week nearing a six-month high on concern that Iran, the third-largest OPEC producer, would attack Israel.