(Corrects plunge in headline, lede to 4.3 pct, not 4.6 pct)
1350 GMT – Saudi Arabia’s stock market plunges 4.3 percent
to a 13-month low on Saturday, with its biggest listed companies
losing value, after King Abdullah cut short a holiday abroad
because of regional tensions.
Only one of the 156 companies listed on the
all-share index, the food-manufacturer Herfy, gains
ground. All 155 others fall.
Heavyweight Saudi Basic Industries Corp (SABIC),
the world’s biggest petrochemical company, falls 2.13 percent,
while Al Rajhi Bank, the kingdom’s largest listed
lender, loses 4.5 percent.
King Abdullah arrived back in Riyadh early on Saturday
morning from Morocco after ending a holiday to deal with
“repercussions of the events that the region is currently
witnessing,” Moroccan and Saudi state media reported.
The world’s top oil exporting nation is a main supporter of
Syrian rebels, who have faced serious reverses since the
Lebanese Shi’ite Muslim militia Hezbollah entered the war in
support of President Bashar al-Assad.
Leading Sunni clerics in the Middle East have used
increasingly sectarian language in the weeks since, raising the
spectre of wider conflict between Sunnis and Shi’ites in the
Middle East.
The index falls to its lowest level since May 7 2012, with
market analysts attributing the drop to geopolitical concerns in
a stock market dominated by small-scale retail traders.
However, market liquidity on Saturday is very high, at 9.7
billion riyals ($2.6 billion), compared to an average this year
of less than 6 billion riyals a day.
“The consensus view is that geopolitical concerns have
dominated investors’ minds. That’s what caused the market to
drop,” said John Sfakianakis, chief investment strategist at
Masic investment company in Riyadh.
“The fundamentals are very obvious for the market to reverse
its downward pressure. Once the concern clears out, we should be
seeing a reverse of the downward trend,” he added.
0830 GMT – Saudi stocks drop heavily in early trade on Saturday
after global equity markets slide and on events in Syria.
The kingdom’s benchmark all-share index falls 1.83
percent to
7,483.83 points
while petrochemicals and banking stocks also fall.
The petrochemicals index is down 1.45 percent.
SABIC is down 1.33 percent.
U.S. crude hit a nine-month intraday high on Friday, after
news that the United States had authorized sending weapons to
Syrian rebels led to concerns about Middle East supplies.
U.S. stocks fell on Friday on low volume to end their third
negative week in four on lingering concern over whether the
world’s central banks will soon start to trim their stimulus
programs.
The banking index is down by 1.77 percent. Al Rajhi
Bank is down 2 percent.
(Reporting by Marwa Rashad and Reem Shamseddine)