SABIC keeps TASI afloat

24/05/2009 00:00 AST

The Saudi stock market continued to move more or less horizontally yesterday and closed with a gain of 48.23 points or 0.8 percent at 6,100.85, a level not seen since Oct. 22.

Sector activity was mainly positive, with losses in only 5 of the 15 sectors, namely banking, cement, telecom, insurance and media. Sector gains on the other hand ranged from 3.13 percent for the Petrochemical Industries to 0.07 percent for Hotel & Tourism. Overall market breadth was positive, with 81 advancers and 38 decliners giving an AD ratio of 2.13, however supported by a slightly weaker liquidity of SR8.3 billion.

The session started on a weak note, but was able to reverse the negative momentum toward the second half of the day, helped by the Petrochemical sector and mainly by Saudi Basic Industries Corp. (SABIC), the Jeddah-based Financial Transaction House (FTH) said in its daily commentary about the stock market.

“The current close at the 6,100 level is a step in the right direction but it does not take us out of the woods yet as we basically continue in a horizontal direction,” Faisal Alsayrafi, managing director and CEO of FTH, said.

Major banks were in the red yesterday. Shares in Riyad Bank, Saudi Hollandi Bank, Samba Financial Group and SABB fell, while Al-Rajhi Bank and Bank Albilad showed positive performance.

SABIC shares surged 3.36 percent to close at SR69.25 yesterday.

In the Telecom sector, shares in Saudi Telecom Co. (STC) dropped to SR52, Etihad Etisalat to SR37.90 and Etihad Atheeb Telecommunication Co. to SR19.25. However, shares in Mobile Telecommunication Company Saudi Arabia (Zain KSA) increased slightly to SR12.65 yesterday.

Meanwhile, Dar Al-Arkan Real Estate Development Company plans to offer shareholders one bonus share for each existing two to raise its capital and fund expansion, it said in a statement on Tadawul website yesterday.

The Dar Al-Arkan board proposed using the bonus issue to raise the firm’s capital to SR10.8 billion from SR7.2 billion. The capital hike will be paid by a transfer from the statutory reserve and retained earnings.

Dar Al-Arkan shares before capital increase were 720 million which will be raised to 1.08 billion through the issuance of 360,000,000 additional shares, on a one free share for every two shares owned by shareholders basis.

Shareholders will vote for the bonus issue proposal at an extraordinary assembly for which the date will be fixed later.

Arab News