Gulf Markets Weaken Amid Strait of Hormuz Tensions as US-Iran Talks Begin

Escalating concerns over the Strait of Hormuz have triggered declines across Gulf stock markets, coinciding with the opening of diplomatic negotiations between American and Iranian representatives in Switzerland aimed at resolving regional tensions.

According to Iran's Tasnim agency, sources affiliated with the negotiating team have signaled that passage through the Strait of Hormuz would remain restricted absent a ceasefire agreement affecting Lebanon and improved conditions for Iranian petroleum shipments. U.S. officials have expressed skepticism regarding these assertions about potential closure of the waterway.

Market performance across the region reflected investor anxiety. Saudi Arabia's primary equity index contracted by 0.4%, dragged down by declines in the Saudi Arabian Mining Company, which fell approximately 2%, and the National Bank of Saudi Arabia, which lost 0.6%.

Qatar's index retreated 0.3%, driven largely by a 0.8% drop in Qatar National Bank shares. Bahrain's index managed a modest gain of 0.1%, while Oman's index fell 1.2% and Kuwait's declined 0.2%.

Beyond the Gulf region, Egypt's primary stock index edged upward by 0.1%.