JEDDAH, 5 September 2005 — The Saudi Stock market rebounded yesterday after a plunge of over 400 points on Saturday. The Tadawul All Share Index (TASI) surged 152.27 points to close at 14,607.90.
After opening at 14,455.63, the index reached as high as 14,611.06 and as low as 14,394.67 points during the trading.
The Industrial index gained 472.20 points at 38,269.25 followed by the Banking index which closed at 32,015.58, up 116.81 points. All other indices also recorded gains yesterday.
Al-Baha Investment & Development Co. posted hefty 8.57 percent increase in its price at SR190 followed by Saudi Advanced Industries Co. by 5.98 percent at SR620, National Gypsum Co. by 5.41 percent at SR1,228, Assir Trading, Tourism & Manufacturing Co. by 4.26 percent at SR594 and Hail Agriculture by 4.20 percent at SR217.
Among the losers Etihad Etisalat topped the list with 1.08 percent fall at SR643, followed by Samba Financial Group by 0.34 percent at SR872, Saudi Export by 0.18 percent at SR566, the Saudi British Bank (SABB) by 0.12 percent at SR1,258.75 and Yamamah Cement down marginally at SR1,365.
Saudi Basic Industries Corp. shares recovered yesterday by 1.22 percent to close at SR1,597.50.
Seventy-two stocks where higher while only five were down out of 77 stocks traded yesterday.
Financial expert Khaled Al-Jowhar said Saturday’s index fall was expected because during the past weeks the index was going up as a result of speculative trading. He said stocks of SABIC and Saudi Electricity were leading the market, adding that the two companies had played a big role in driving up the index.
He said smart speculators had benefited a lot from deals during the past weeks. “Most of them were closely following up the movement of stocks in order to bag maximum profits,” he said. Jowhar said he expected the index to fall to 14,200 and as lower as 13,900.
Meanwhile, the Kuwait stock market continued its positive performance in August on the back of economic growth and an undercurrent of strong liquidity owing to high oil prices.
According to the Kuwait-based Global Investment House, the benchmark “Global” general index was up by 3.85 percent to end the month at 271.80 points. The index has reported YTD gain of 42.23 percent at the end of August.
The market capitalization of the stock exchange reached KD34.11 billion, a growth of 5.08 percent compared to July. The Kuwait Stock Exchange price index, which reached its highest level ever during the month, closed the month at 9,642.3 points, recording an increase of 7.46 percent over the previous month. With the trading value for the first eight months already exceeding the total value of shares traded for the full year of 2004, market analysts believe that the index might breach the psychological barrier of 10,000-point mark on the back of strong buying interest.
Strong profit growths helped boost the investment sector to the forefront of gainers during the month, as the “Global” investment sector Index climbed 11.98 percent in August. The profits of investment sector companies during the first half of 2005 more than doubled compared to the corresponding period last year, reporting an increase of 108.49 percent. International Investment Group (IIG) hogged the limelight as it was among the leaders in terms of volume and value of shares traded on the bourse. IIG was also the top performer in terms of first half profit, registering a gain of about 838.96 percent compared to same period last year.
The newly listed stock on Kuwait bourse, Grand Real Estate Company is also managed and owned by IIG. As a result of recent developments, the stock appreciated by 46.7 percent in August to end at 550 fils. In addition, 29 stocks out of 34 stocks listed under the investment sector reported monthly gains. The volume of shares traded during the month reached its second highest level for the year, at 5.1 billion shares, up 58.5 percent compared to last month.
The market breadth was skewed positively with 106 stocks advancing in the month and 36 stocks declining, while 7 stocks remained unchanged.
The market added two new companies in August, further improving the depth of the market. Al Deera Holding Company was listed under investment sector, where as Grand Real Estate Projects Co. under the real estate sector, which increased the total number of listed companies to 149. So far, 24 new companies have been added to the market in 2005.
Food sector also reported positive performance on back of good corporate results by all the five companies listed in the market. United Fisheries of Kuwait (UFK) along with United Industries Company and other investors established a real estate development company with a capital of KD16.5 million. UFK was also awarded two international certifications under the guidance of international certification organizations Societe Generale de Surveillance SA (SGS-SA) and Specialized Industrial & Management Systems (SIMS). The share of UFK ended the month at 440 fils, reporting a monthly gain of 14.3 percent. It is also reported that Kuwait Food Company is in final stages of negotiations to acquire a share in Domti Products Company in Egypt.
Public Warehousing Company (PWC), a market heavy weight came out with a right issue to increase capital by 16.64 percent, which will be managed by National Bank of Kuwait (NBK). PWC was also awarded a 5-year contract, worth $180 million by the US Defense Logistics Agency. PWC and KOC will sign a contract for the transportation of heavy machinery used in oil drilling to the local market. Despite positive developments by the company, the stock ended the month in red may be because of rights issue (increase of capital), registering a drop of 8.9 percent.