RIYADH, 27 May 2003 — Saudi shares, buoyed by high liquidity levels, yesterday surged to a new all-time high amid active trading despite the impact of the May 12 suicide bombings in Riyadh, analysts said.
The Tadawul All-Shares Index (TASI) closed on 3,109.07 points, up 1.1 percent on Sunday’s closing of 3,074.79 points.
This is the second record high this week after Saturday’s 3,076.28 points. The market finished the week Thursday at 3,058.00 points. “It is certainly a surprising trend” to see the market increase just after the blasts when it was expected to dive, said Shankar Kailasam, financial consultant at the Consultant Center for Finance and Investment (CCFI).
“The main factor is high liquidity and bright first quarter corporate results. The dollar depreciation is greatly benefiting the Saudi balance of payment. All these factors are pushing the market up,” Kailasam told AFP.
Based on the latest figures by the Saudi Arabian Monetary Agency (SAMA) or central bank, domestic liquidity at the end of the first quarter hit its highest level ever. It reached $103.9 billion, up 15.3 percent on its level a year ago, and as much as 2.4 percent on the end-2002 level and 1.6 percent higher than its level at the end of February.
The TASI is 23.5 percent higher than the start of 2003. The index has been rising steadily since the start of the US-led war against Iraq on March 20, increasing 22.8 percent since then.
The upward trend has been led by the main blue chips including eight of the nine commercial banks, Saudi Telecom, Saudi Basic Industries Corp. (SABIC) and the Saudi Electricity Co. (SEC), the three largest firms, respectively.
