DUBAI--Gulf stock markets may come under pressure on Sunday after oil prices fell and Islamic State militants carried out their first attack in Saudi Arabia.
Brent oil settled down $1.17, or 1.8 percent, at $65.37 a barrel on Friday, falling 2.1 percent on the week as a rallying dollar and profit-taking ahead of a long U.S. holiday weekend cut short a two-day rally.
Global equity markets dipped but remained near record highs on Friday after Federal Reserve Chair Janet Yellen said she expected United States interest rates to rise this year.
Although a Fed interest rate increase could boost the margins of some Gulf banks which have zero-interest deposits, equities in general usually suffer from rate hikes. Most currencies in the Gulf are pegged to the dollar.
A more immediate concern, though, is security. A suicide bomber killed 21 worshippers on Friday in a packed Shi'ite mosque in eastern Saudi Arabia in one of the deadliest assaults in recent years in the largest Gulf Arab country.
Also, two people in southern Saudi Arabia were killed at the end of last week by cross border rocket attacks launched from Yemen where heavy fighting continues.
Meanwhile, corporate news flow from the Gulf has been thin. Kuwait's Al Ahli Bank may rise after announcing it will Piraeus Bank's Egyptian unit for $150 million, a deal which will support its regional expansion.
Egypt's market closed above technical resistance at 8,860 points, its early May peak, on Friday and any clean break, confirmed by two straight daily closes, would trigger a minor double bottom formed by the April and May lows and pointing up to around 9,400 points.
REUTERS
