x Abu Dhabi, UAESunday 23 July 2017

Saudi equities lifted for second week

Saudi Arabian equities extended their rally for the year to more than 5 per cent yesterday, lifted by gains in the banking sector ahead of fourth-quarter earnings.

Saudi Arabian equities extended their rally for the year to more than 5 per cent yesterday. AFP PHOTO / STR
Saudi Arabian equities extended their rally for the year to more than 5 per cent yesterday. AFP PHOTO / STR

Saudi Arabian equities extended their rally for the year to more than 5 per cent yesterday, lifted by gains in the banking sector ahead of fourth-quarter earnings announcements expected this week.

Banks are expected to notch up big profits in the coming weeks as the kingdom's stimulus plans filter through the economy.

Last month, the Saudi council of ministers endorsed 820 billion riyals (Dh803.17bn) in expenditures for this year, an increase of 18.8 per cent compared with last year.

Saudi equities surged for the second straight week, breaking the 7,000 points mark on Wednesday.

Yesterday the Tadawul All-Share Index rose 0.55 per cent to close at 7,165.76. Leading the charge were shares in Al Rajhi Bank, Samba Financial Group and Bank Albilad. "Consensus estimates suggests there will be robust year-on-year earnings growth [in the fourth quarter results]," analysts at Securities & Investment Company in Bahrain wrote in a note last week.

Total market capitalisation of the Saudi stock exchange increased more than 2.7 per cent to 1.46 trillion riyals compared with the previous week's 1.42tn riyals. The index has shown gains of more than 5 per cent since the start of the year.

And 1.3 billion shares worth 31.7bn riyals changed hands last week - a weekly increase of 52.2 per cent on volume basis and 26.7 per cent in terms of value.

Benchmark oil dropped 26 cents to finish at US$93.56 a barrel in New York on Friday amid concerns that China's government could limit economic stimulus measures.

But reports that Saudi Arabia produced 9 million barrels of crude oil in December, 500,000 barrels less than the previous month, kept prices from falling further. Official figures will be released on Wednesday.

* with agencies