JEDDAH, 8 November 2007 — Positive corporate earnings news, record high oil prices and improved investor sentiment sent Saudi stocks soaring yesterday. The Tadawul All-Share Index (TASI), which crossed the 9,000-barrier on Tuesday, continued to surge to close 52.50 points higher at 9,058.59.
The index is 14.18 percent, or 1,125.30 points higher so far this year after falling over 52 percent last year.
Saad Al-Salimi, a stock market observer, said the current behavior of the Saudi stock market reflected the keenness of Saudi investors to hold the market index from sliding down to 7,000 points. The market also displayed its immunity against surprise news or rumors. Investors have learned to keep their stakes without selling until they rose to sufficiently high price levels. He stressed the importance of not being carried away by rumors. The investors have learned to analyze shares on their merits and demerits, he said.
In the insurance sector, shares of Saudi Arabian Cooperative Insurance Company (SAICO) jumped by 10 percent to SR99 and Allied Cooperative Insurance Company (ACIG) by 9.85 percent to SR111.50 yesterday. Shares of Saudi Fransi Cooperative Insurance Company, Saudi Indian Company for Cooperative Insurance and Al-Ahlia Insurance Company also increased yesterday. However, shares of Malath Cooperative Insurance and Reinsurance Company dropped by 3.29 percent to SR124.75. Shares of Tawuniya (the National Company for Cooperative Insurance) also fell 1.83 percent to SR133.50.
Shares of Riyad Bank, SABB, Banque Saudi Fransi and Arab National Bank declined, while Bank shares of AlJazira and Samba Financial Group increased yesterday. Shares of four banks remained unchanged.
Shares of Saudi Basic Industries Corp., (SABIC), a major chemical producer, continued to rise as oil prices, to which chemical prices are linked, raced toward $100 a barrel yesterday. Its shares increased by 1.12 percent to SR156.75 yesterday and 5.58 percent in last 6 trading days.
In the telecom sector, shares of Saudi Telecom Co. (STC) jumped 1.78 percent to SR71.25, but Etihad Etisalat shares fell 1.33 percent to SR73.75.
Shares of 51 companies were lower, while 41 companies were in positive territory yesterday.
Over SR9.57 billion worth of shares changed hands yesterday.
BMG Index Turnover Up 6.6%
The BMG Saudi Index ended the week on a positive note, advancing by 1.1 percent to close yesterday’s session at 494.6 points, which is a closing level unattained since Oct. 31, 2006. The market turnover also increased by 6.6 percent to reach SR3.6 billion ($955 million). The BMG Saudi Index’s sectors ended the session on mixed note. Both the agricultural sector and the industrial sector went up by 1.4 percent and 1.3 percent, respectively, whereas the services sector declined by 2.7 percent. The insurance sector also went down by 2.7 percent with all its constituent shares witnessing losses.
Only 7 shares in the index witnessed gains, while 19 declined and 4 remained unchanged. The best performing share was Jazan Development Company, which strengthened by 5.9 percent to close at SR27 per share.
