The Saudi stock market's main index, TASI, witnessed a notable decline at the start of trading on Thursday, falling by 1.2% and losing approximately 130 points to settle at 10,722 points. This decline coincided with trading volumes of 1.2 billion riyals, reflecting a cautious sentiment among investors.
Market performance and leading stocks
According to data from the Saudi Stock Exchange (Tadawul), the trading volume reached approximately 69.5 million shares, with a total market capitalization of around SAR 9.35 trillion. The performance of most listed companies was predominantly negative, with 198 companies experiencing declines, while only 60 companies saw their share prices rise out of a total of 268 companies listed on the main market. Among the biggest losers were shares of companies such as Saudi Paper Manufacturing, Research and Media, Saudi Reinsurance, Jaco, and Lumi. Conversely, shares of companies like Al Rajhi Takaful, GIG, Al Fakhariya, Jazeera Takaful, and Eastern Development recorded notable gains, placing them among the top performers.
General context and importance of the Saudi market
The Saudi Stock Exchange (Tadawul) is the largest and most liquid market in the Middle East and North Africa region, and is considered a key indicator of the health of the Saudi economy and a cornerstone for achieving the goals of Vision 2030. Vision 2030 aims to diversify the Kingdom's revenue streams away from oil, strengthen the role of the private sector, and attract foreign investment. The financial market plays a pivotal role in financing these mega-projects. Therefore, the performance of the Tadawul All Share Index (TASI) not only reflects the sentiment of local investors but also serves as a measure of international investor confidence in the Kingdom's economic transformation.
Potential effects and influencing factors
The Tadawul All Share Index (TASI) is influenced by a range of local and global factors. Globally, oil prices directly impact the performance of leading companies in the energy and petrochemical sectors. Monetary policy decisions, particularly those of the US Federal Reserve, are quickly reflected in the Saudi market due to the riyal's peg to the dollar, as interest rates affect borrowing costs and investment decisions. Locally, the financial results of listed companies, government spending projects, and macroeconomic data such as inflation and growth rates significantly influence market trends. The current decline, while part of normal market fluctuations, may prompt investors to reassess their portfolios while awaiting greater clarity on the economic factors affecting the short and medium term.
