DUBAI-- Mixed messages from the oil market and concern that full-scale fighting in Yemen may soon resume could leave Gulf bourses trading sideways on Sunday, while Egypt may stabilise after Standard and Poor's revised its debt outlook to positive.
Brent crude edged up on Friday, but U.S. oil fell as traders and investors debated whether oil's rally over the past month and a half should continue amid stubbornly high supplies.
In Yemen, a five-day humanitarian truce agreed last week is to end in the early hours of Monday, and no new agreements have so far been announced to extend it.
The Yemen conflict is not a big factor for the markets but investors in the Middle East and especially in Saudi Arabia, which leads the coalition against Yemen's Houthi rebels, have reacted negatively to it. So a resumption of full-scale bombing could weigh on stocks, at least temporarily.
The first-quarter earnings season in the Gulf is largely over, so there will be fewer catalysts for the markets in the next few weeks. However, Abu Dhabi investment firm Waha Capital , one of the last companies in the region to report results, may rise after posting a 20 percent increase in quarterly profit.
Meanwhile Egypt's bourse, which hit a five-month low of 8,303 points on Thursday because of speculation that the country might eventually be excluded from MSCI's emerging markets index, may stabilise after rating agency Standard and Poor's revised the country's sovereign credit outlook to positive from stable.
The move was not a surprise, but may nevertheless be a modest positive for stocks. The agency cited Egypt's gradual economic recovery, supported by improving, albeit still fragile, political stability.
Several Egyptian companies including Commercial International Bank, the country's biggest listed lender, reported strong first-quarter results at the end of last week, which were initially ignored in a panic sell-off.
On global markets, U.S. equities were almost flat on Friday while European stocks edged down.
REUTERS
