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Saudi Arabian bourse dips 7% on global woes

MUSCAT: International economic woes, stemming from the bleak outlook of United States economy, as well as euro-zone debt problems negatively impacted the performance of the Saudi market in the third quarter of 2011, according to a market report by Global Investment House.

Tadawul All Share Index (TASI) shed 7.05 per cent of its value in the third quarter, bringing its nine-month loss to 7.68 per cent, as it closed at 6,112.37 points.

In the first nine months this year, the research note says, a total of 34.94 billion shares were traded on the exchange, up by 34.3 per cent compared to the corresponding nine months in 2010. Aggregate value of shares traded increased from 588.7 billion Saudi riyals ($157 billion) in the nine-month period last year to 776.4 billion ($207 billion) in the nine months this year, up by 31.9 per cent year-on-year.

The petrochemical sector was the most active in terms of volume and value of shares traded in the nine months in 2011, with 7.6 billion shares exchanged at an aggregate value of 264.6 billion riyals ($70.5 billion), which represented 21.8 per cent and 34.1 per cent, respectively, of the market's aggregate volume and value for the nine months in 2011, adds the Global study.

Within the sector, heavy-weight Saudi Basic Industries Corporation ( Sabic ) constituted 15.1 per cent of total value traded on the exchange in the nine months of 2011, with an aggregate value of 117.1 bilion riyals ($31.2 billion). Sabic recorded a price decline of 11.7 per cent, as its stock price ended the the nine-months of 2011 at 92.5 riyals.

In the meantime, Alinma Bank witnessed intense selling pressure during the third quarter of the year, leading its share price to post a nine-month decline of 11.9 per cent, as it ended at 9.25 riayls. Investors exchanged 3.2 billion of the bank's shares, at an aggregate value of 32.1 billion ($8.6 billion), representing 9.2 per cent and 4.1 per cent of the market's aggregate volume and value traded in the nine months of 2011, respectively.

Sectoral performance
Out of 15 sectoral indices, only five sectors managed to eke out some gains, while 10 sectors posted losses. Among gainers, Media and Publishing index posted the highest advance amongst its peers, up by 29.9 per cent. Tihama Advertising and Public Relations Company had a stellar performance, with its share price adding 123.3 per cent in gains by the end of that period.

Another prominent gainer was the cement sector, with its index appreciating by 18.9 per cent. All the sector's components managed to end the nine months on a higher note, buoyed by strong cement demand in Saudi Arabia and increase in cement prices.

On the negative side, Banks & Financial Services was among declining sectors, with its index shedding 14.1 per cent of its value.

All listed banks ended on a lower note, with the sole exception of Bank Al Jazirah, which managed to add a marginal gain of 2.13 per cent.

Share price of the largest two listed Saudi banks, Al Rajhi Bank and Samba Financial Group retreated by 16.6 per cent and 28.5 per cent respectively.

On the companies' level, 71 companies managed to end 9M2011 on a higher note, versus 75 decliners. Among gainers, 44 companies managed to post double digits gains, with several insurance companies dominating the list. Share price of Amana Cooperative Insurance Company and Buruj Cooperative Insurance Company appreciated by 115.09 per cent and 114.16 per cent respectively.

© Times of Oman 2011