JEDDAH/AMMAN: Saudi shares plummeted last week after two weeks of continuous gains and the application of the “swap agreements” that allow foreigners to trade Saudi stocks.
The Tadawul All-Share Index (TASI) shed 4.43 percent last week, closing at 8,504.72 points from 8,898.97 points in the previous week.
TASI is currently 23 percent lower than the year’s start.
The Riyadh-based Bakheet Investment Group (BIG) said in its weekly report that the market is expected “to stabilize” during the month of Ramadan, which started on Monday, and prices would be “relatively unchanged” as investors await the third quarter results of listed firms.
Saudi Paper Manufacturing Co. was the top gainer last week as its shares jumped 8.66 percent to SR69.
Shares in Saudia Dairy & Foodstuff Co. (SADAFCO) plunged 9.55 percent to SR35.50 last week.
The stock market turnover also dropped sharply to SR16.40 billion last week compared to SR32.69 billion in the previous week.
Leading Arab bourses slipped last week and financial analysts yesterday attributed the plunge to the advent of the fasting month of Ramadan, shrinking volume of liquidity and the absence of fresh moving factors.
“We believe investors’ decisions have been affected by the start of the month of Ramadan, when business retreats to a low ebb, and the lack of new moving factors,” an Amman-based portfolio manager said. “However, we also do think that the low prices of stocks will trigger a wave of buying in the coming two weeks that reverses the downward trend,” he said.
Other analysts expected regional stocks to rebound toward the end of September, when third quarter results start to come out.
Jordanian shares were volatile last week amid a profit-taking wave that targeted leading firms particularly the Arab Potash Co., the Jordan Phosphate Mines Co. and the Jordan Petroleum Refinery.
The All-Share Price Index of the Amman Stock Exchange gained 0.31 percent last week, closing at 4,330 points from 4,317 points in the previous week, according to the ASE weekly report.
Kuwaiti shares extended losses last week and the decline was blamed on leading investment funds that allegedly played havoc with prices.
The KSE All-Share Price Index lost 3.7 percent last week, closing at 13,962 points compared with previous week’s close at 14,499 points.
The benchmark of the United Arab Emirates stock exchanges of Dubai and Abu Dhabi shed further 2.1 percent last week to close at 5,226 points from 5,337 points in the previous week.
Egypt’s CASE 30 index, which measures the performance of the market’s 30 most active firms, gained 3.1 percent last week, closing at 8,401 points from 8,375 points previous week.
The GulfBase GCC Index also declined 3.62 percent to 6,059.12 points last week. The value of GCC traded shares plunged 37.82 percent to $8.02 billion and volume was down 33.39 percent to SR2.21 billion of shares.
BMG turnover down
The BMG Saudi Index decreased week-on-week by 5.2 percent to reach a closing level of 456.48 points. In addition, the total market turnover depreciated by 48 percent to SR7.7 billion ($2 billion) compared to SR14.9 billion ($4 billion), registered previous week.
The number of shares traded went down by 41.3 percent to 134.71 million shares compared to previous week’s 326.4 million shares. The average price-earnings (P/E) ratio for 2007 earnings was 24.55 times, while the price-to-book (P/B) ratio was 4.60 times.
All the sectors recorded losses last week. The worst performer was the industrial sector, decreasing by 6.5 percent.
The beta coefficient for the sectors was 1.03 for the industrial sector, 0.99 for the banking sector, 0.98 for the services sectors, and for the other sectors: 0.76 for the telecommunications sector; and 0.35 for the insurance sector.
Two shares moved up, whilst 25 shares went down and three stood still.
