JEDDAH/AMMAN, 17 November 2007 — Saudi stocks retained their bullish trend for the fourth week in a row, receiving support from blue chips particularly the Saudi Basic Industries Corp. (SABIC).

The Tadawul All-Share Index (TASI) gained further 2.28 percent last week, closing at 9,264.75 points and bringing the total rise in four weeks to 17 percent.

TASI is currently 16.8 percent higher than the year’s start.

The Riyadh-based Bakheet Investment Group (BIG) said in its weekly report that SABIC shares increased by 20 percent since Oct. 23, with a P/E (price/earning) ratio of 16 times giving confidence in the company’s future growth. In contrast, Saudi Kayan Petrochemical Co. witnessed a sharp correction as its shares decreased by 3 percent last week after an unjustified increase over the past three weeks gaining around 49 percent.

The BIG report said some banks also have witnessed an increase in their share prices last week. Shares of Al-Rajhi Bank, the 3rd largest stock in the market, increased by 4 percent, which added more support to market. On the other hand, speculative stocks witnessed limited activities concentrating on some stocks from the insurance sector, making investors worried about the inconsistency of these stocks and their unjustified increases.

The BIG report expected the Saudi stock market to be rather steady during the next week. Investors will be eyeing for any positive news about the annual budget for Saudi Arabia, which can add more confidence to the market. In contrast, speculative stocks will suffer from selling pressure after the gradual increases for the last four weeks.

Shares of Al-Ahlia Insurance Company for Cooperative Insurance jumped by 16.57 percent to SR100.25 last week, Saudi Arabian Cooperative Insurance Co. by 12.63 percent to SR111.50, Saudi Industrial Development Co. by 11.70 percent to SR26.25, the Mediterranean & Gulf Insurance & Reinsurance Co. by 10.94 percent to SR53.25 and Saudi Arabia Fertilizer Co. by 10.03 percent to SR170. Shares of the National Shipping Company of Saudi Arabia dropped 5.13 percent to SR18.50 last week and Eastern Agriculture by 4.56 percent to SR73.25.

In the banking sector, shares of SABB fell 3.86 percent to SR118.25 and Saudi Hollandi Bank by 3.54 percent to SR54.50 last week.

The stock market turnover increased slightly last week to SR45.28 billion from SR44 billion in the previous week.

Other Arab stock markets closed week on a steady note, but financial analysts said yesterday they did not exclude periodical slips as part of profit-taking moves ahead of the New Year.

“I believe regional stocks will keep the upward trend in the coming weeks as investors watch the performance of listed firms in the remaining weeks of the year,” an Amman-based portfolio manager told Arab News.

“Arab stocks are certainly receiving support from the soaring oil prices and the relatively low prices shares had reached over the past months, but at the same time we cannot exclude downward pressures due to profit taking attempts,” he added.

Jordanian shares showed a modest performance this week with investors taking a wait-and-see approach ahead of the publication of yearly corporate profits, analysts said.

The all-share price index of the Amman Stock Exchange gained 0.56 percent last week, closing at 6,795 points up from 6,757 points previous week, according to the ASE weekly report.

Kuwait’s KSE all-share price index shed 1.0 percent last week, to close at 12,484 points compared with previous week’s close at 12,606 points.

The all-share price index of the United Arab Emirates stock exchanges of Dubai and Abu Dhabi rose 1.5 percent, closing week at 5,612 points from 5,528 points previous week.

The GulfBase GCC Index also increased 1.59 percent to 6,332.33 points. The value of GCC traded shares, however, plunged 17.75 percent to $23.97 billion and volume declined by 33.35 percent to 11.19 billion shares.

BMG Saudi Index Increases 5.4 Percent

The BMG Saudi Index gained more ground last week, having increased by 5.4 percent from its close of previous week to reach 521.47 points. The total value of the transactions traded during the week was SR19.1 billion ($5.1 billion), up by 9.1 percent from previous week’s turnover and the highest weekly turnover in a month, indicating an average daily turnover of SR3.83 billion ($1 billion). The average P/E ratio for 2006 earnings has now reached 29.4 times, whilst the price to book ratio is 5.12 times.

The industrial sector advanced by 5.9 percent and the insurance sector improved by 4.3 percent. The services sector moved ahead by 1.3 percent, whilst the agricultural sector came in last, recording 0.8 percent change from its close previous week. The industrial sector’s constituents increased by 46.3 percent of the total value traded during the week, while the services sector registered 23.8 percent.

The agricultural sector’s portion was 15.2 percent of total investments in the index, whereas 14.7 percent was the insurance sector’s contribution last week. As for the “beta coefficient” for each sector, the agricultural sector recorded the highest beta of 1.58, followed by the service sector whose beta was 1.41. The insurance and the industrial sectors registered betas of 0.99 and 0.26, respectively.