JEDDAH, 13 January 2007 — The Saudi Stock market began the new year on a negative note. The stock market dropped 52.53 percent in 2006 after surging more than 103 percent in 2005. The Tadawul All-Share Index (TASI) shed 373.67 points or 4.5 percent last week to close at 7,559.62 points.
The index closed at 7,933.29 points at the end of last year compared to 1,6712.64 points in the previous year.
The market capitalization also dropped 49.72 percent last year to SR1,225.86 billion. However, the total value of shares traded reached SR5.26 trillion in 2006 compared to SR4.14 trillion for the previous year, posting an increase of 27.14 percent.
With the impending annual corporate results, the Riyadh-based Bakheet Financial Advisors (BFA) said in their weekly report the equity market movement this week will depend on “the actual results compared with investors’ expectations in a market disturbed by random speculation.”
The stock market turnover was over SR55.6 billion last week. Anaam International Holding Group Co., which is trading in the services sector, was most active by value last week at SR3.4 billion, followed by Saudi Fisheries at SR3.37 billion and Al-Babtain Power and Telecommunication Co. at SR2.59 billion.
Al-Baha Investment & Development Co. was top gainer last week as its shares jumped 47.33 percent to SR48.25.
Shares of all listed banks were in the negative territory last week.
Saudi Basic Industries Corp.’s (SABIC’s) shares fell over 3 percent last week to SR102.
Arab bourses, which lost more than $400 billion in 2006, ended the first week of 2007 down, but analysts said yesterday they were cautiously optimistic about the performance of stock markets in 2007.
“There is cautious optimism in regional markets, as investors monitor the financial results of listed firms in 2006,” Wajdi Makhamreh, deputy CEO of the Amman-based Osoul Brokerage Co., told Arab News.
“In addition to expected dividend distributions, we believe political turmoil in the region and the retreating oil prices have something to do with the negative mood still dominating the markets,” he said. Makhamreh contended that the huge petrodollar surpluses accruing to Gulf countries were “instrumental in shoring up regional stocks” between 2002 and 2005.
Middle East stocks plummeted throughout 2006 and analysts said they believed the total loss of regional bourses exceeded $400 billion, with the brunt of the loss being incurred by the Saudi bourse.
“I believe investors will focus on the speculative type of shares at the time being until the publication of balance sheets of blue chip firms,” Makhamreh said.
Though Jordanian shares entered the year with a slow, slightly negative start, it managed to end the week on a somewhat positive note.
The all-share price index of the Amman Stock Exchange closed week at 5,528 points, which represents a 0.18 percent rise over the previous close, according to the ASE weekly report.
Analysts said the Jordanian stock market benefited from news that Moody’s Investors Service had upgraded the foreign currency deposit ratings of several Jordanian banks.
In Kuwait, the KSE all-share price index gained 0.4 percent last week, closing at 10,104 points compared with the previous close of 10,067.
The United Arab Emirates stock exchanges of Dubai and Abu Dhabi moved sideways this week, reflecting variant expectations of investors as to the 2006 results, analysts said.
The all-share price index of the UAE stock markets declined 86 points last week, to close at 4,036 points from the previous close of 4,122 points.
