JEDDAH/AMMAN: Saudi shares kept up their recovery last week, led by blue chip firms in petrochemicals, telecommunications and information technology.
The Tadawul All-Share Index (TASI) gained 3.36 percent last week, closing at 8,463.71 points, compared to 8,1888.30 points in the previous week.
TASI is currently 23.3 percent lower than the year’s start.
“The Saudi stock exchange is expected to continue its recovery in the coming days as investors make benefit from the attractive low prices of blue chips,” the Riyadh-based Bakheet Investment Group (BIG) said in its weekly report.
The stock market turnover also increased slightly to SR23.67 billion last week from SR21.29 billion in the previous week.
Tawuniya (The Saudi Company for Cooperative Insurance) was the top gainer as its shares jumped 17.80 percent last week to close at SR77.75.
Although the market seems oversold on negative sentiments, TASI is developing a bullish momentum that will bring some recuperative rally in the coming sessions, the National commercial Bank (NCB) said in its weekly report.
From the technical perspective, TASI will face a strong support level at 7,600 points on the down cycle while the up cycle resistance exists at 8,500 points for the rest of August, the NCB report said.
In NCB’s estimates, a market capitalization of SR1.59 trillion and a price-earning multiple of 17.52, suggests that the level of prices is approaching a fair-value status.
Arab stock market reflected a mixed performance last week and financial analysts said yesterday they expected regional shares to remain volatile ahead of the fasting month of Ramadan, which is due to start on Sept. 1 or 2.
“We think markets will remain volatile in the coming weeks in the absence of moving factors and the advent of month of Ramadan,” Nizar Taher, head of brokerage at the Jordan Ahli Bank said.“The retreat of regional markets over the past few weeks had also something to do with volatile oil prices and a spate of speculation that played havoc with Arab bourses,” he said.
With the exception of the Saudi stock exchange, almost all Arab bourses lost ground last week, led by the Amman Stock Exchange (ASE), which plummeted throughout the week’s trading sessions.
Jordanian shares plunged dramatically under the pressure of a sell-off panic triggered by rumors that foreign funds were selling their holdings of Jordanian leading shares, notably the Arab Potash Co., the Jordan Phosphate Mines Co. and the Jordan Petroleum Refinery. Both the authorities and the concerned firms denied the rumors. The All-Share Price Index of the Jordanian stock exchange plummeted 8.9 percent last week, closing at 4,040 points from 4,439 points previous week, according to the ASE weekly report.
Kuwaiti shares closed week marginally lower amid a wave of speculation that targeted leading stocks, analysts said. The KSE all-share price index closed week marginally lower at 14,588 points from 14,616 points previous week. The United Arab Emirates also extended losses last week. The benchmark price of the UAE stock exchanges of Dubai and Abu Dhabi shed 2.1 percent, to close week at 5,417 points compared with previous week’s close at 5,531 points.
The GulfBase GCC Index also edged higher slightly to 6,270.37 points. The value of GCC traded shares, however, fell by 0.12 percent to $10.85 billion and volume declined by 5.68 percent to 3.00 billion of shares.
BMG index surges
After adjusting the quarterly rebalance of the BMG Saudi Index, it broke its negative performance witnessed for three weeks in a row to move ahead last week by 3.4 percent to 458.89 points. The total market turnover appreciated week-on-week by 8.5 percent to reach SR9.6 billion ($2.6 billion), compared to SR8.9 billion ($2.4 billion) registered last week, with an average turnover per session of SR1.9 billion ($515 million). The number of shares traded went up 0.4 percent from the volume traded during last week, to reach 219.6 million shares, compared to previous week’s 218.7 million shares. The average price-earnings (P/E) ratio for 2007 earnings was 25.8 times, while the price-to-book (P/B) ratio was 4.59 times. The beta coefficient for the sectors was 1.03 for the industrial sector, 0.99 for the services sectors, 0.97 for the banking sector, and for the other sectors: 0.76 for the telecommunications sector, and 0.35 for the insurance sector. Twenty-one shares moved up last week.
