25/06/2018 08:06 AST

Saudi insurance stocks surged on Sunday, with investors expecting the sector to reap significant dividends following the lifting of the ban on female drivers.

Insurance stocks — one of the worst performing sectors on the Saudi bourse for the year to date — outperformed other classifications on Sunday, ending 2.4 percent higher, compared with a 1.8 percent rise for the Kingdom’s headline index.

Amana Insurance and AlRajhi Takaful were the best performers of the day, gaining 9.9 percent each. Tawuniya, the Kingdom’s largest insurer, ended Sunday 1.1 percent higher, with only one of the country’s 33 listed insurance providers closing lower for the day.

The lifting of restrictions on female drivers — which came into effect on Sunday after first being announced in September — is part of a series of wide-ranging reforms introduced as part of Saudi Arabia’s Vision 2030 economic transformation program, designed to diversify the economy away from a reliance on oil revenues.

The advent of women drivers is forecast to benefit the economy by significantly increase female participation in the workforce, and stimulating financial, insurance and retail sectors among others.

The insurance sector is set to draw particular benefit from the move, but may remain under pressure, according to rating agency S&P. “We anticipate that efforts of the local authorities to tackle the large number of uninsured drivers, combined with the arrival of women drivers … and the introduction of additional benefits under the unified medical policy from July 1, will support further premium growth in the industry in the medium term,” said S&P in a research note in April.

“However, these factors may be offset by the large number of foreign workers that have already left or will be leaving the Kingdom in 2018.” In spite of yesterday’s price surge, insurance stocks are 8.4 percent lower for the year to date. Tadawul as a whole is up 15.6 percent so far this year, making the bourse one of the world’s best performers for 2018.

Investor sentiment on Sunday was also boosted by investor optimism after index provider MSCI announced last week that it would upgrade Saudi stocks to its Emerging Markets Index from next year.

The widely anticipated upgrade — which puts Saudi equities on an index tracked by around $2 trillion worth of global assets — is expected to attract up to $40 billion of international funds, Tadawul CEO Khalid Al-Hussan told Arab News last week.

MSCI’s upgrade came after a similar move by fellow index provider FTSE Russell in February, which is also scheduled to come into effect from next year. Banks were among the other bright performers on Tadawul on Sunday. Arab National Bank led gains, closing up 4.2 percent, while blue-chip names NCB and AlRajhi rose 1.6 percent and 2.3 percent respectively.

Some petrochemical companies also added value, Reuters reported, following a rise in oil prices after OPEC decided on only modest increases in crude production last week.

Outside Saudi Arabia, Gulf markets posted minor gains. In Dubai, where the index was flat, Air Arabia was unchanged. Shares in the airline have declined by more than 10 percent since early last week, when the company said it had hired experts to protect its business interests in private equity firm Abraaj, which has filed for provisional liquidation. The airline said its exposure was around $336 million. Last week, the UAE’s securities regulator asked listed companies to declare their exposure to Abraaj.


Arab News

Ticker Price Volume
DSI 0.37 0
SABIC 119.00 3,097,278
SAICO 11.48 1,245,614
STC 80.90 227,141
ARCCO 23.60 285,754
BURUJ 24.50 139,049
ALMARAI 45.00 124,248

TASI 7,496.91 -165.26 (-2.16%)

Market
P/E
Price/BookValue
Dividend Yield (%)
Performance
  • 1-Month
  • 3-Month
  • 1-Year
Volume Change
  • 10D Avg Vs 90D Avg
Index vs...
  • 52-w high
  • 50-day moving avg.
  • 200-Day Moving Avg
Ticker Price Change
SABIC 119.00 -0.80 (-0.67%)
STC 80.90 -2.60 (-3.12%)
RJHI 81.90 -2.40 (-2.85%)
NCB 41.90 -1.50 (-3.46%)
SECO 14.52 -0.18 (-1.23%)
Abu Dhabi breaks out to new trend high

18/11/2018

The Dubai Financial Market General Index (DFMGI) dropped by 47.1 or 1.67 per cent last week to close at 2,778.76, the largest decline in 13 weeks. Market breadth was also bearish with 27 issues decli

Gulf News

Kuwait bourse begins off-exchange trades Sunday

18/11/2018

Boursa Kuwait announced on Saturday it would begin on Sunday effecting Over the Counter Market (OTC) regulations and trading in this off-exchange system at the national stock exchange.

The

Arab Times

Boursa Kuwait plans OTC market

18/11/2018

Boursa Kuwait announced Saturday the introduction of an Over the Counter Market (OTC). The new market will serve as a trading platform for companies that are not listed on Boursa Kuwait.

O

Arab Times

Abu Dhabi index jumps over 5,000 level again

15/11/2018

First Abu Dhabi Bank (FAB) surged with aggressive volumes even as the Abu Dhabi index jumped more than a per cent to breach the keenly watched level of 5,000 level on Wednesday.

The Abu Dh

Gulf News

Boursa Kuwait keen to honor CMA regulations

15/11/2018

Boursa Kuwait said it was committed to application of governance in compliance with regulations of Capital Market Authority (CMA), and to meet needs of traders. Boursa Kuwait has a duty to establishi

Arab Times