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Investors Adopt Wait-and-See Attitude

JEDDAH, 6 October 2007 -- The Saudi stock market declined last week as investors adopted wait-and-see attitude in view of the Eid Al-Fitr holidays. They are also waiting for the third-quarter results of the listed companies.

The Tadawul All-Share Index (TASI) dropped by 2.07 percent to 7,765.17 points last week. The index closed at 7,929.71 points in the previous week.

The National Company for Glass Industries was top gainer last week as its shares jumped 5.05 percent to SR52. Shares of Saudi Cable Co. gained by 2.56 percent to SR40, Alujain Corporation by 1.49 percent to SR34, Saudi International Petrochemical co. by 1.36 percent to SR37.25 and Arab Cement by 1.25 percent to SR81. Shares of the National Agriculture Marketing Co. plunged by 27 percent to SR54.75, Tourism Enterprise Co. by 25.20 percent to SR47.50 and Al-Baha Investment & Development Co. by 23.59 percent to SR37.25.

In the insurance sector, shares of Allied Cooperative Insurance Group fell by 21.03 percent to SR92 and Arabian Shield Cooperative Insurance Company by 19.85 percent to SR52.50.

The banking sector was also in the red last week. Riyad Bank shares dropped 7.87 percent to SR58.50, Bank Aljazira by 5 percent to SR52.25 and The Saudi Investment Bank by 4.38 percent to SR38.25. Al-Rajhi Bank shares also fell slightly to SR86 last week. Saudi Telecom Co. (STC) shares fell by 3.02 percent to SR64.25 and Etihad Etisalat by 1.11 percent to SR66.75 last week. The stock market turnover, however, rose slightly to over SR22 billion last week as compared to SR20.09 billion in the previous week.

Meanwhile, the Capital Market Authority (CMA) has approved the initial public offerings (IPOs) of five new companies. The Trade Union Cooperative Insurance Company, which has a capital of SR250 million, will offer 42 percent of its shares while Al Sagr Company for Cooperative Insurance and Arabia Insurance Cooperative Company, each with a capital of SR200 million, will sell 42 percent and 40 percent of their shares, respectively. The IPOs will take place between Oct. 27 and Nov. 3, 2007, the CMA said in a statement. The CMA has also approved the IPOs of Gulf Training & Education Co. and Middle East Specialized Cable Co. The IPOs will take place between Nov. 5 and 12, it said. The CMA also announced that the shares of Al-Ahlia Cooperative Insurance would be listed on the Saudi bourse today.

The GulfBase GCC Index rose 0.83 percent to 5,622.91 points last week. The value of GCC traded shares also increased 20.73 percent to $12.77 billion and volume surged 18.84 percent to 6.06 billion.

BMG Saudi Index Shows Downward Trend

The BMG Saudi Index reversed its performance last week with a downward trend. The index lost 11.4 points in Wednesday's session to close at 407.5 points, having decreased by 2.7 percent when compared to previous week. Conversely, the average total turnover traded last week climbed by 29.1 percent versus the previous week. The total turnover reached in Wednesday's session was SR11.6 billion ($3.1 billion), having averaged SR2.3 billion per session during the week. The average P/E ratio on 2006 earnings was 25.8 times, while the price to book ratio was 3.9 times.

All sectors followed in the footsteps of the index and witnessed downward trends. When compared to previous week's close, the industrial sector outperformed all other sectors by dropping a relatively low 7.1 percent, with a total trading value of $1 billion, equivalent to 33.3 percent of the index's total turnover for the week.

The agricultural sector plunged by 14.1 percent and achieved a total value of $0.7 billion during the week, or 22.1 percent of the index's total turnover. The services sector was the worst performer of all, dipping by 18.1 percent and trading a turnover of $0.9 billion through the week, approximately 29.6 percent of the index's total traded value. As a newly added sector to the index, the insurance sector witnessed a negative change of 4.4 percent in sessions between Saturday and Wednesday.

A total of 143.1 million shares were traded during the week. Saudi Basic Industries Corp. (SABIC) was the best performer last week in terms of the increase in its share price, which reached SR127.50 per share. Malath Cooperative Insurance and Reinsurance Company was the second best performer with a 0.2 percent appreciation in its share price and a close at SR131 per share registered by the end of Wednesday's session. All other stocks witnessed declines when compared to their closing prices last week.

© Arab News 2007