JEDDAH: Saudi Arabian blue chips extended declines into a second trading day yesterday as investors took profits in stocks that had rallied this month and the markets prepared for the holy month of Ramadan. The Tadawul All-Share Index (TASI) fell 2.08 percent or 185.10 points to 8,713.87 points. The stock market turnover was SR4.59 billion yesterday.
The measure had gained 14 percent in the 2-1/2 weeks after hitting a 10-month low on Aug. 10 as the Kingdom introduced new transparency and trading rules that boosted sentiment.
“There is profit-taking today after the increases we saw last week and this month,” said Hesham Abo-Jamee, division head of asset management at Riyadh-based Bakheet Investment Group.
The bourse on Aug. 16 began naming investors with stakes of 5 percent or more to improve transparency, a week before announcing foreigners would be allowed to buy shares through licensed Saudi intermediaries.
Blue chips gained momentum after the moves. Saudi Basic Industries Corp. (SABIC), the world’s largest chemicals firm by market value, jumped more than 16 percent from a 10-month trough on Aug. 10 to Wednesday’s close. The stock fell 3.61 percent yesterday while Riyad Bank, up more than 18 percent since Aug. 10, shed 3.50 percent.
“There were also some decreases in global stock markets and that is reflecting on the stock market here,” Abo-Jamee added. US stocks fell hard on Friday after Dell warned that companies were cutting technology spending worldwide.
BMG index dips
The BMG Saudi Index ended the week’s first trading session losing 11.39 points, equivalent to 2.4 percent of its closing level, which reached 470.47 points. The total turnover decreased by 12.6 percent to SR2 billion ($519 million), compared to SR2.2 billion ($594 million) registered in Wednesday’s trading session.
Only the insurance sector gained more ground, moving up by 0.3 percent, whereas the rest of the sectors witnessed losses. The session’s worst performer was the industrial sector, going down by 2.9 percent, whereas the following sectors also stepped down; telecommunication by 2.2 percent, banking by 1.6 percent, and services by 1.4 percent.
Three shares went up, while 22 went down, and five stood still.