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Saudi Arabian stocks briefly erased the year’s gains on Monday before rebounding strongly as bargain hunters stepped in following steep recent losses.

The Tadawul All Share Index dropped as much as 0.7% in the first hour of trading, taking it below where it started 2022. It quickly reversed course and was trading up 1% as of 11:10 a.m. local time.

The benchmark is down almost 18% from a May peak, nearing bear market territory and representing a significant change of fortune for what had once been one of the world’s best-performing markets. Gulf equities have been selling off recently after largely ducking the rout that has hit global stocks.

Oil, which had been among the factors buoying regional markets, fell the most in three months last week after Federal Reserve Chair Jerome Powell signaled he would double down on efforts to tame inflation, increasing the risk of a recession that could dent energy consumption.

“It’s too early to say the sentiment has shifted. Yes, there’s some money being taken off the table. I think it’s more short-term trading, and reaction to decline in the international markets,” said Faisal Hasan, chief investment officer at Al Mal Capital. “The risk of international economic downturn and a possible recession in developed market is affecting the markets in general.”

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