JEDDAH, 11 September 2005 — Over 4.73 percent increase in the Industrial index sent the Saudi stock market soaring yesterday after a drop of 3.9 percent last week. The Tadawul All Shares Index jumped by 402.32 points or 2.82 percent to close at 14,675.29. The Industrial index closed at 38,653.55, up 1,744.38 points.
Smart recovery by Saudi Basic Industries Corp. (SABIC) shares also helped to boost the index. SABIC shares skyrocketed by 5.18 percent to close at SR1,618.
Reem Muhammad Asaad, an investment expert, advised dealers to be cautious while putting their money in stocks. She also suggested that prices of SABIC stocks might go down with the fall of oil prices as they are inter-linked.
Out of 77 stocks traded yesterday, 74 were higher while only 2 were down.
The Banking index was also edged higher by 461.25 points at 32,283.66. Most of the bank stocks were trading higher yesterday except the Saudi Investment Bank (SAIB), which closed slightly lower at SR866.
Shares at the Saudi British Bank (SABB) and Banque Saudi Fransi were higher by 3.53 percent at SR1,289 and 3.02 percent at SR1,211, respectively.
Ali Al-Duwaihi, a stock market analyst, said he expected continuous changes in prices of stocks because of speculative trading and advised investors to purchase bank stocks. He also expected that prices of Bank Albilad stocks would go up further to reach SR900 when market conditions improve. Its shares closed yesterday slightly higher at SR730.50.
“Bank shares are one of the best investment options because you will make good returns from them every year as their prices will not go down,” he pointed out.
Qassim Agriculture shares jumped by 9.95 percent to close at SR201.75 followed by Filing and Packing Materials Manufacturing Co. (FIPCO) by 6.76 percent at SR395, Hail Agriculture by 6.50 percent at SR213, Eastern Agriculture by 5.98 percent at SR195 and Gas & Industrialization by 5.89 percent at SR498.75.
Saudi Electricity Co. was most active by volume at 9,723,425 as its shares closed at SR140.75.
Saudi Telecom Co. (STC) shares were also higher by 2.26 percent at SR950.
Meanwhile, according to the information received here yesterday, the share right offering of SHUAA Capital closed successfully on Sept. 5. Demand from shareholders was strong and the share offering was oversubscribed by at least two times. The Dubai-based company issued 154 million new shares at a price of 4 dirhams per share resulting in total issued share capital of 550 million shares.
SHUAA Capital’s chairman, Majid Saif Al-Ghurair, said “We are pleased with the response from shareholders and their vote of confidence in their company. Demand for the additional shares was strong and it was an opportunity for shareholders to add to their investment at a very attractive price”.
Iyad Duwaji, chief executive officer, said: “With the new capital raised of AED616 million, the company will be able to maintain the organic growth of its underlying businesses and consider the acquisition of strategic interests in similar businesses across the region, deriving value through synergies and economies of scale. Additionally, the proceeds from the rights offering will provide us with liquidity to seed several new products expected to be launched by the company in the near term”. The company expects to credit the additional shares in shareholders’ accounts with the Dubai Financial Market and Kuwait Stock Exchange and will refund the over subscriptions amount in the next two weeks.