RIYADH, 10 July 2005 — Saudi shares slipped 3 percent in morning trade yesterday as investors extended the wave of profit-taking since the index of the Arab world’s biggest bourse hit an all-time record last month.
The market index eased to 12,341 points in relatively quiet trade worth just under SR4 billion ($1.07 billion). Bankers said many investors were staying out of the market until it showed signs of an upswing. “It’s mainly profit-taking. There’s been a big run on the market,” said Riyad Bank analyst Ziyad Awad. “Nobody wants to get back in too early.”
The share index is now down 12 percent since it hit a peak on June 19 of 13,996 points, driven by record oil prices which have sent confidence soaring in the world’s biggest crude exporter.
The market is still 50 percent up since Jan. 1 and economists say many shares - particularly the smaller stocks which they say have been pushed up by largely speculative buying — remain expensive despite overall strong corporate results.Some bankers said Thursday’s bombings in London may also have had some impact on market sentiment. Others said there was no evidence the London attacks had directly influence prices in Riyadh, especially as oil prices recovered on Friday from Thursday’s dip.
Shares in Samba Financial Group, which announced record second quarter profits after the market closed for the week on Thursday, fell yesterday in spite of its results. Samba stocks were down nearly 1 percent at SR872 at the end of morning trade.
Petrochemical giant SABIC, which is not expected to announce its first half results for another 10 days, fell more than four percent to SR1,118. SABIC shares hit a high of SR1,495 in April.
The index later closed at 12,281.97 points.
