06/11/2017 06:14 AST
Shares of Kingdom Holding Co tumbled on Sunday to hit their lowest level in 52 weeks after Saudi’s billionaire Prince Al Waleed Bin Talal Al Saud, who holds 95 per cent stake in the company was reportedly arrested on corruption charges.
Banque Saudi Fransi, in which Kingdom Holding holds 16.2 per cent stake, also fell.
“There has been an uncertainty created around Kingdom Holding, whose share price declined the maximum allowed 10 per cent. The medium term direction of Saudi markets will depend on the length of the detention of the prominent individuals arrested Saturday,” Vaqar Zuberi, Head of Hedge Funds, Mirabaud Asset Management told Gulf News.
Kingdom Holding fell to a low of 9.26, the level last seen in nearly a year, before closing 7.59 per cent lower at 9.50 riyals. Banque Saudi Fransi, in which Kingdom Holding owned by Prince Alwaleed holds 16 per cent stake, closed 1.57 per cent higher at 29.20 riyals.
About 11 princes were arrested along with 38 other officials were arrested in Saudi Arabia in an anti-corruption drive, to create “a healthy environment” for investments, according to Bloomberg.
Prince Alwaleed has an estimated wealth of $17 billion, making him the richest Arab, according to Forbes Middle East, holds stake in global companies like Twitter, Citigroup, JD.com, Accor Hotels, Four Seasons Hotels & Resorts, among others.
Recovery in Tadawul
The broader Tadawul index recovered from its intra-day low because of buying in banks and real estate companies.
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The Tadawul index closed 0.32 per cent higher at 6,978.73, recovering from a low of 6.801.5. The second market called as Nomu index tumbled more than 2 per cent to be at 3,056.25.
However, analysts said it is too early to call for a buying opportunity.
“Stocks would remain volatile. Selective buying is warranted, but it is too early a see this a broader buy on dip kind of an opportunity. I would wait on the sidelines until more clarity,” said an analyst who wished not to be named because of the sensitivity on the matter.
In other stocks, Saudi Basic Industries closed 0.36 per cent higher at 99.80 riyals, Dar Alarkan Real Estate Development closed nearly 5 per cent higher at 7.99 riyals.
Gulfnews
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