01/07/2010 00:00 AST
Saudi Arabia’s stock benchmark Tadawul All-Share Index (TASI) ended 0.69 percent lower on Wednesday to 6,093.76 points for a sixth session in seven as end-of-quarter selling weighed. The index losses reached 3.9 percent since June 23.
Saudi Basic Industries Corp (SABIC) fell 1.4 percent, Saudi Electricity Co dropped 1.6 percent and Saudi Arabian Fertilizers Co (Safco) lost 2.7 percent.
“There’s no reason for the market’s decline - global markets, oil and US futures are up - perhaps it’s because today is the last day of the quarter,” said Hesham Abo Jamee, Bakheet Investment Group head of asset management. “Expectations are for Q2 earnings to be good for most companies.”
Bakheet forecasts combined bank profits will rise 8 percent quarter-on-quarter, Jamee said.
“After the financial statements are issued, investors will again buy stocks and prices should increase, especially in the petrochemicals sector,” Jamee added. Traders said regional markets are closely tracking the Dow Jones industrial average, which has fallen 4.2 percent over the same period.
Dubai’s index fell 1.4 percent to 1,462 points. Abu Dhabi’s measure dropped 0.7 percent to 2,514 points.
Kuwait’s benchmark fell 0.7 percent to 6,543 points. Oman’s measure slipped 0.2 percent to 6,058 points. Bahrain’s index dipped 0.4 percent to 1,396 points.
Saudi and Omani stocks fell for the sixth session in seven, Kuwaiti shares for the fifth in six. “It’s still too early to position for Q2 numbers, especially with the inherent volatility,” said Julian Bruce, EFG-Hermes director of institutional equity sales.
Dubai’s index fell to 1,462 points, its lowest close since February 9, 2009. Arabtec dipped 2.8 percent and Dubai Financial Market lost 2.1 percent.
“Today was a reaction to the aggressive sell-off on international markets following disappointing economic numbers from China and there’s a lack of interest locally in our markets so they are moving lower,” said Marwan Shurrab, vice-president and chief trader at Gulfmena Alternative Investments.
“China and Asia had been expected to lead growth in 2010, while the Europe and the US were facing problems.”
Shuaa Capital tumbled after the chief executive of its brokerage arm resigned, heading losers on Dubai’s index DFM, which slumped to a new 16-month low.
Shuaa fell 6.3 percent, its lowest finish for more than a year.
Abu Dhabi’s benchmark ADI also declined, falling 0.7 percent to 2,514 points, with property stocks the hardest hit.
“Abu Dhabi real estate stocks are following the high beta names in Dubai - there’s no appetite from long-term investors and short term investors took intraday positions before selling off at the end of the session,” said Shurrab.
Saudi Gazette
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