Saudi shares continue slump amid fears of US retaliatory strikes
A volatile Saudi stock market slumped a further 5.6 percent in the week closing Thursday, unnerved by fears of US retaliatory strikes for the September 11 terror attacks on New York and Washington.
The NCFEI all-shares index dropped to 2,278.75 points from 2,415.03 the previous Thursday, Bakheet Financial Advisors (BFA) reported.
The index, now only 0.9 percent higher than at the start of the year, has lost 10.3 percent since the devastating terror attacks that left thousands dead.
"The Saudi stock market witnessed a state of high volatility following the recent attacks in America and the state of war declared by the United States," BFA said.
"The unease in the Saudi market was also caused by the news of an approaching worldwide recession, which will eventually lead to a reduction in the demand for oil, thus affecting the producing countries' economies negatively," it said.
OPEC's basket price of crudes, used by the cartel to set output policy, fell to its lowest level in more than two years at 19.87 dollars Wednesday.
Blue chip losers were led by Southern Cement and market leader SABIC (Saudi Basic Industries Corp.), which dropped 7.4 and 7.3 percent, respectively. Stock prices of only two companies rose, 61 fell and 13 issues did not trade.
Trading value fell back to 1.8 billion riyals (488 million dollars) from 2.8 billion riyals (741 million dollars) last week.
Elsewhere in the Gulf region, stock markets in Kuwait, Bahrain, Oman and Qatar fell 7.3, 6.0, 4.9 and 3.9 percent, respectively, while the Emirates bourse rose 0.5 percent. Bakheet said the figures highlighted the "deep dependence of the Saudi economy on oil."
The NCFEI is the most capitalised in the Arab world at more than 60 billion dollars, but operates only as an interbank market system. ― (AFP, Riyadh)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)