JEDDAH, 20 June 2005 — The Tadawul All-Share Index (TASI) plunged by 827.18 points to 12,852.59 points during early hours of trading yesterday as investors sold their shares in panic, but the market recovered quickly to reach record 13,996.83 points before closing at 13,505.98 points.

Altogether some 243,753 deals worth SR26.54 billion took place yesterday, involving exchange of 69.67 million shares. Prices of many companies in the agricultural, industrial and banking sectors fell. But prices of the Saudi Basic Industries Corp. (SABIC), which dominate the market, were up 1.67 percent at closing.

Other companies which made gains were hotels (4.65 percent), Mubarrad (4.21 percent), Shams (4.07 percent) and Al-Rajhi Banking & Investment Co. (3.6 percent). Jizan Agricultural Co., Qassim Agricultural Co., Fitaihi, Al-Asmak and Hail Agricultural Co. were the biggest losers as their prices went down by 9.9 percent.

It was not immediately clear the main reasons for the sudden plunge in the early hours of the day.

But some sources attributed it to the punitive measures taken by the Capital Market Authority against 35 companies registered on the bourse. But the quick recovery showed the measure had little impact on the market.

The CMA said on Saturday that 44 senior executives and board members of 35 Saudi companies would be fined for trading in the stock market during a restricted period in 2004. It said the decision was taken by its board of commissioners for violating Article 33 of the Listing Rules of registering companies in Saudi Arabia.

On Saturday, the market made record performance with sales crossing SR26 billion and the index reaching record 13,680 points. Analysts attributed the record performance to soaring oil prices, which left positive impact on prices of petrochemical companies, especially SABIC, which contributed about 50 percent of the gains.

In a related development, the CMA said yesterday that Saudi dairy firm Almarai would offer 4.5 million shares in an initial public offering in July to raise SR2.3 billion ($613 million).

The offering, which represents 30 percent of Almarai stock, will be priced at SR512 per share and will run from July 4 until July 13, the CMA said. Only Saudis are eligible to subscribe and applications should be for a minimum of 10 shares and a maximum of 5,000.

The listing values Almarai at SR7.68 billion in total. HSBC, Britain’s biggest bank, is financial adviser to the offering and Saudi British Bank is acting as lead underwriter.

Almarai, 40 percent owned by Saudi food group Savola, says it is the largest food exporter in Saudi Arabia with 4,000 staff, 45,000 livestock and a processing capacity of 1.4 million liters of milk a day.

A source close to the offering said Almarai made a net profit of SR372 million last year on a turnover of SR2 billion.

Its long-awaited flotation follows high profile initial public offerings by another dairy company, SADAFCO, telecoms provider Etihad Etisalat (Mobily) and Bank Albilad, which were heavily oversubscribed.

Meanwhile, Samba Financial Group announced yesterday that it would distribute 12.5 percent in dividends from half-yearly profits of its Al-Fareed Fund at the rate of SR370.40 per unit. Eissa Al-Eissa, Samba’s managing director and CEO, said the fund had made a return of 84.4 percent this year.

Also yesterday, the Jordanian stocks climbed 3.6 percent, buoyed by leaks of semi-annual results of listed firms and the advent of surplus petrodollars seeking safe investment in the country, analysts said.

The all-share price index of the Amman Stock Exchange (ASE) closed at an all-time high of 7,464 points from the previous closing of 7,202 points registered on Thursday.

“The market was led by the heavyweight Arab Bank, which gained all the 5 percent limit-up, and other blue chip firms, which appeared poised for record semi-annual profits at the end of June,” a portfolio manager told Arab News.

“We expect Jordanian stocks to remain bullish until the third week of July, when most of firms are expected to have published their second quarter results,” he added.

The ASE volume also increased by more than 50 percent to 131 million dinars ($185 million), according to the market’s daily report.

— Additional input from Abdul Jalil Mustafa in Amman