Gulf Stocks Rise on Hopes for Renewed US-Iran Diplomacy

Gulf stock markets experienced an uptick in early trading on Thursday, driven by hopes that diplomatic engagement between the United States and Iran might resume. This optimism emerged despite recent exchanges of recriminations between the two nations earlier in the week.

Adding to the diplomatic currents, Qatar's prime minister is set to visit Tehran on Thursday. The visit is intended to revive diplomatic channels, occurring as Washington signals its intent to intensify economic pressure on Iran through sanctions targeting its trading partners.

Meanwhile, a senior Iranian source reported on Wednesday that Iran and Oman are in the final stages of an agreement concerning the management of the Strait of Hormuz. This strategic waterway is vital for linking major Gulf oil producers to global markets. Iran's Revolutionary Guards confirmed that the two countries have reached an accord on how to share the management of this critical maritime passage.

In market performance, Saudi Arabia's benchmark index edged up by 0.1%, with most stocks trading in positive territory. Notable gains included National Industrialization Company, which climbed 3.6%, and oil giant Saudi Aramco, which rose 0.5%. Saudi Aramco has also offered additional crude for September loading outside the Strait of Hormuz, following sales of at least 4 million barrels to China this month, according to sources familiar with the matter.

Dubai's main index increased by 0.4%, with a majority of its constituents advancing. Etihad Energy saw a 2.9% rise, while Emirates Central Cooling Systems added 1.3%. Abu Dhabi's benchmark climbed 0.3%, supported by a 1.3% increase in conglomerate Alpha Dhabi Holding and a 1.2% rise in First Abu Dhabi Bank, the largest lender in the United Arab Emirates. Qatar's index gained 0.5%, led by gains in communication and energy shares, with telecoms operator Ooredoo advancing 1.9% and Qatar Gas Transport rising 1%. QatarEnergy has issued a spot tender to sell naphtha cargoes from Ras Laffan port, located within the Strait of Hormuz.