Saudi shares brushed aside slack trading in the Muslim fasting month of Ramadan, larger budget deficits for 2001 and 2002 and low oil prices to close a shortened week unchanged, Bakheet Financial Advisors (BFA) said Wednesday, December 12. The NCFEI all-shares index closed at 2,345.73 points, just 0.65 points less than last week's closing of 2,346.38 points. The index is still 3.9 percent higher than at the start of the year.
"The Saudi stock market was volatile this week ... It was influenced by the stagnant market due to low trading during the holy month of Ramadan, as investors were still awaiting for the corporate results of 2001," BFA said. "The market was also affected negatively by the slump in Al-Rajhi Banking and Investment Corp. (ARABIC)," BFA added.
Shares of ARABIC, the second largest bank representing 11.4 percent of the market capitalization, lost 2.8 percent after news broke that the bankrupt US oil giant Enron owed some $101 million to the bank. Following the announcement, the index shed a dozen points on Monday before recovering on Tuesday after ARABIC assured dealers that its position will not be affected.
The decline in oil prices also negatively affected trading in the market. More than 80 percent of Saudi revenues come from oil. Saudi Arabia, the world's largest oil producer and exporter, sits on a quarter of proven oil reserves. Stock prices of 26 companies rose, 24 fell, nine remained unchanged and 17 issues did not trade.
Trading value in the four days of trading dropped almost 27 percent to 580.3 million riyals ($154.7 million) from last week's 792.1 million riyals ($211.2 million). The main blue chip gainers were the Saudi Hollandi Bank and the Saudi American Bank, which rose 2.1 percent and 1.3 percent respectively. The big losers were ARABIC and Southern Province Cement Co., which dropped by 2.8 percent and 1.5 percent respectively.
The NCFEI is the most capitalized market in the Arab world at more than $70 billion, but operates only as an interbank market system. — (AFP, Riyadh)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)
