Gulf markets fell on March 1 when some reopened for the first trading day after the dramatic escalation between Israel, the United States and Iran on February 28. 

Bombings have rattled financial markets and disrupted aviation and shipping across the Middle East, after Israel launched a daylight attack on Tehran on February 28 with US participation. Iran retaliated with missiles launched against Israel and US-linked targets in Arab Gulf cities.

Iran’s Islamic Revolutionary Guard Corps (IRGC) swore revenge following the death of Iran's Supreme Leader Ayatollah Ali Khamenei in joint Israel-US strikes on Tehran on February 28. 

Israel was hit by a barrage of missiles on the morning of March 1, with air raid alerts sounding across Jerusalem and central and southern regions.

Blasts were reported in the Dubai area and over Doha for a second consecutive day on March 1. Iranian retaliatory strikes forced the closure of major regional airports, including Dubai, in one of the most severe episodes of aviation disruption in years.

Qatar and Bahrain both faced continued Iranian missile attacks in the early hours of March 1, with authorities in both countries reporting direct hits despite interception efforts. 

Only some Middle Eastern markets were open on Sunday, March 1 including Saudi Arabia, Bahrain and Muscat, providing an early barometer of how investors will assess the fallout from the fighting in the region, ahead of the opening of most global markets on Monday.

In Saudi Arabia, the benchmark Tadawul All Share Index (TASI) was at 10,441 as of 12.30 local time, down -2.49%, but up from the low of 10.262 when it opened. 

Losers included Elm Co (ELM), Arabian Drilling (ARABIAN DRILLING) and Tourism Enterprise Co. (TECO) and Zahrat Al Waha for Trading Co. (OASIS)

Oil giant Saudi Aramco was up 2.56%, buoyed by expectations of surging crude prices. Barclays on February 28 raised its Brent crude forecast to around $100 a barrel from $80 a day earlier, citing heightened geopolitical risk and potential supply disruptions.

Previously, Saudi Arabia opened its stock market to all foreign investors in February as part of its Vision 2030 strategy aimed at liberalising the economy and reducing dependence on oil revenues.

In Oman, the Muscat Stock Exchange’s MSX30 index fell by 1.920%, with losses for 25 of its companies, while two rose and three remained unchanged.

The steepest losses for MSX-listed companies on March 1 were for Raysut Cement (RCCI), Galfar Engineering & Contracting (GECS), Jazeera Steel Products (ATMI) and Asaffa Foods (SPFI). 

Bahrain’s main stock index was down 1.03%, with APM Terminals Bahrain B.S.C. (APMTB) topping the list of losers. Losses were also reported by listed companies including Khaleeji Bank B.S.C. (KHALEEJI), Aluminium Bahrain B.S.C (ALBH). and Al Salam Bank B.S.C. (SALAM). 

Tehran's Stock Exchange was shut down on February 28 shortly after Israeli strikes on the capital began, having opened the session with a gain of more than 30,000 points before trading was suspended. Elsewhere in the region, Boursa Kuwait also suspended trading as a precautionary measure.