JEDDAH, 30 September 2006 — The Saudi stock market witnessed the return of activity in speculative stocks last week despite the high risk of a massive corrective retreat involved in this kind of investment.

The Tadawul All-Share Index (TASI) gained 1.05 percent or 116.93 points last week, closing at 11,225.28 points, up from 11,108.35 points in previous week.

TASI is currently 32.8 percent lower than the year’s start.

The stock market turnover also declined last week to SR79 billion from SR99 billion in the previous week.

In the banking sector, shares of four banks — Samba Financial Group, The Saudi Investment Bank, Bank Albilad and Bank AlJajira — fell while shares of all other banks increased last week.

Saudi Industrial Services Co. was top gainer last week as its shares jumped 45.78 percent to SR133.75, followed by Saudi Land Transport Co. by 45.71 percent to SR114.75, Saudi Fisheries by 40.29 percent to SR410 and Al-Baha Investment & Development Co. by 35.48 percent to SR236.75.

Shares of Saudia Dairy & Foodstuff Co. plunged 5.28 percent last week to SR85.25.

“Investors are eyeing the upcoming third quarter corporate results, particularly for the blue chips, which will be the main market’s driver in the next period,” the Riyadh-based Bakheet Financial Advisors (BFA) said in its weekly report.

The BFA expected investors to “re-evaluate their portfolios according to the results” of listed firms in the first nine months of the year.

BFA also warned that speculative grade stocks remained “subject to a corrective retreat due to their record rises that were not based on investment fundamentals”.

In Kuwait, the KSE all-share price index rose 0.6 percent last week, to close at 10,098 points compared with 10,035 points in the previous week.

The all-share price index of the United Arab Emirates stock exchange of Dubai gained 1.6 percent last week, closing at 432.97 points, up from 425.24 points last week.

The Dubai benchmark price is currently about 55 percent lower than the year’s start.

However, the chairman of the UAE stock exchanges Abdullah Al-Tarifi considered this retreat as a “healthy phenomenon”, given the sharp rise in the prices of the UAE shares over the past three years.

Al-Tarifi ruled out any intervention by the Stock Exchange Commission to prop up prices and said the body could only step down to correct any violations of frauds.

Arab stock markets showed sluggish performance last week as Muslim countries go deep into the fasting month of Ramadan, but financial analysts said yesterday they expected regional bourses to “rebound” toward the end of the month, buoyed by third quarter results of listed firms.

“We expect markets to pick up in the last week of Ramadan, propelled by what is widely believed to be positive results for the third quarter,” said Nizar Taher, an analyst at the Atlas Investment Group, the Arab Bank’s investment arm.

Taher and other portfolio managers attributed the retreat in the turnovers of regional stock markets to the psychology of the fasting month and the change of positions by investors as the third quarter draws to a close.

“As for the Amman Stock Exchange (ASE), we are optimistic that the third quarter profits, particularly of blue chips, will give momentum to Jordanian shares,” Taher said.

The ASE all-share price index edged lower, closing week on Thursday at 6,084 points compared with last week’s close at 6,099 points, according to the market’s weekly report.