Record budget pushes Saudi stocks forward

30/12/2012 09:17 AST

Saudi Arabian shares rose the most in a week on expectations the government’s record budget expenditure for 2013 will support economic growth.

The benchmark Tadawul All Share Index gained 0.15 percent to 6,877.06, the most since Dec. 22, at the close Saturday. The Saudi index has gained 7.2 percent this year after falling 3.1 percent in 2011.

Samba Financial Group, the biggest mover in terms of percentage points on the Saudi gauge, increased 1.1 percent to SR45.5. Kingdom Holding advanced 6.3 percent to SR20.2.

The Kingdom is embarking on an investment program valued at more than $500 billion to build infrastructure, industry and create jobs.

“Although external factors might seem negative due to the US fiscal cliff, Saudis are enthusiastic about the Saudi fiscal budget for this year which is affecting the market in a positive manner,” said Mohammed Al-Omran, financial analyst and president of the Gulf Center for Financial Consultancy in Riyadh.

The Standard & Poor’s 500 (SPX) Index dropped 1.9 percent last week, the biggest such decline in almost two months, as investors await the outcome of weekend budget talks by US lawmakers to avert the so-called fiscal cliff, referring to more than $600 billion in tax increases and spending cuts set to take effect in January.

Oil prices slipped slightly Friday. New York’s main contract, West Texas Intermediate light sweet crude for February delivery, edged seven cents lower to settle at $90.80 a barrel. Brent North Sea crude for February delivery dipped 18 cents a barrel in London trade down to $110.62.

After opening in positive territory in New York trade, prices turned lower.

Saudi Gazette