JEDDAH, 30 April 2006 — The Saudi stock market plunged yesterday after gaining 318.80 points last week. The Tadawul All-Share Index (TASI) closed 799.94 points or 5.89 percent down to 12,775.05.
The Industrial Index suffered 1,932.99 points drop at 26,865.25, followed by the Banking Index, which fell 1,311.32 points to 38,784.41.
The market turnover reached SR12.35 billion yesterday compared to SR78.78 billion last week.
Out of 79 stocks traded, 67 were down while only 12 were in a positive territory yesterday.
Financial experts have attributed the present market fluctuations to a lack of confidence between the Capital Market Authority (CMA) on the one side and speculators and investors on the other. They said CMA should not have mentioned the names of companies when it suspended the services of some brokers and speculators, adding that the wrong action had affected the shares of those companies.
“In international markets they name only the speculators, not the companies,” analyst Abdul Mueti Kaaki said.
Talal Basem, a trader, also blamed the CMA for the stock-market crisis.
“It is a very sensitive market. If you make a wrong decision you will see its negative impact on the market,” he pointed out. He said the CMA had taken a number of hasty decisions to control the market after the index reached record high two months ago. The decisions such as reducing the nominal price of shares from SR50 to SR10 and cancellation of commission changed the whole set up of the market and led the market to plummet, Basem explained.
Meanwhile, the Jeddah Chamber of Commerce and Industry (JCCI) will host today a forum devoted to the Saudi stock market, titled “Your Share, Your Richness or Your Poorness.”
Abdul Rahman Al-Motawe, general manager of Adeem International, the co-organizer of the forum along with the JCCI, advised that the announcement of the event was based on the company’s desire to enhance its role in serving the community through presenting a chain of symposiums, first of which to focus on the Saudi stock market.
Such drive would affirm, Al-Motawe said, “the company’s understanding of the importance of awareness and education for community members through organizing of public forums and symposiums where experts and key people talk.”
He added that speakers participating in the forum will be stock experts, including Dr. Said Al-Shaikh, National Commerical Bank (NCB) chief economist, and Asaad Joher, economics professor at King Abdulaziz University, among others.
“We agreed to host symposiums and forums which are expected to be on monthly basis and cover market issues,” said Ziad Al-Bassam, vice chairman of the JCCI.
Al-Bassam added that the JCCI and its affiliated centers, including the Manpower Training and Development Center, are very keen on community education and awareness through continuous forums and symposiums to be held under its umbrella either through its specialized centers or through private sector specialized in training and education.
