RIYADH, 13 August 2004 — Saudi stocks kept up a two-month rally during the week ending yesterday, fueled by record oil prices and strong half-year results in blue chips.
The all-share index closed at 6,219.19 points, up 0.4 percent from last week’s 6,195.56. The index of the largest Arab bourse, climbing for an eighth consecutive week, is up 40 percent this year after rising 76 percent in 2003.
“We expect the market to continue its gradual rise,” Bakheet Financial Advisors said. “The recent high level of oil prices will give positive support to the Saudi economy and the stock market. Investors are also upbeat on the new capital market laws.”
Strong oil revenues have been a boon for the world’s biggest crude exporter, bolstering corporate earnings and raising investor liquidity. Riyadh is to boost output close to 10 million barrels per day (bpd) in September in a bid to tame runaway oil prices.
“Oil prices were up this week due to heightened worries about supply in the Middle East as well as political instability in Venezuela,” Bakheet said.
Turnover slipped to SR37 billion ($9.9 billion) from SR39.3 billion ($10.5 billion) a week earlier, with the Saudi Basic Industries Corp. (SABIC) accounting for 19.4 percent of trading.
SABIC, the Middle East’s biggest petrochemicals producer, was up 2.5 percent at SR540. Last month, the company posted a 67 percent year-on-year increase in half-year net profit.
Saudi Telecom fell 1.9 percent to close the week at SR520 after the government announced that a consortium led by the UAE’s Etisalat would set up a rival mobile network with third-generation technology, breaking Saudi Telecom’s monopoly.
Saudi Arabia, the world’s biggest oil exporter, has a population of around 24 million, including six million expatriate workers, and a rapidly expanding telecom sector.
