• 102 billion riyals gains in domestic shares in the first month of this year


    Saudi stock ended the month of January at their highest level since August 2015 to close at 7650 points. It ends 423 points up, 5.9 percent higher since mid-year, which resulted in an increasing in its market value by 102 billion riyals to reach nearly 1.8 trillion riyals.

    The lowest point in the month was at 7148 points, with a lose of 1.1%; while the highest point was at 7702, winning 6.6%, which shows the market's coherence and holds most of the month's earnings at the end of the period.​

    Despite the positive performance, liquidity declined by 6 percent (5.4 billion riyals) to reach 81.9 billion riyals at a rate of 37,000 riyals per transaction. However, traded shares fell 11 percent by 539 million shares to reach 4.4 billion shares with a turnover rate of 8.46 percent. Transactions fell 7 percent by 165,000 to reach 2.2 million transactions.

    In regard of sectors, nine sectors declined while the rest of the sector were rising. The rise was led by "banks" with 11 percent, followed by "health care" by 10.6 percent, and "media" by 9.5 percent. While the decline was led by "Real Estate Management and Development" with 4.6%, followed by "Real Estate Funds" with 3.6%, and "Long Term Commodities" by 3.2%.

    In stocks and share, the rise was led by "Petro Rabigh" that rose 22 percent to close at SAR 20.08, followed by "AXA Cooperative" by 21 percent to close at SAR 24.14, and "MEPCO" by 17 percent to close at SAR 22.71. However, the decline was led by "Dar Al Arkan" by 30 percent to close at 10.02 riyals, followed by "Metlife" by 22 percent to close at 11.86 riyals, and then "Atheeb" by 16 percent to close at 6.15 riyals.

    In February, traders will be seeing the results of companies whose disclosures may not be completed until the end of March. So far, only 20 companies have announced their financial results, which showed a total increase of about 11 per cent to a profit of 37 billion riyals. There were no losses but eight companies reported a drop in their profits.

    The market is likely to increase this month due to the recent announcement of the accession of the local market to the FTSE Emerging Markets Index, which considered as an attractive factor for foreign liquidity. This would prompt traders to seize opportunities and buy at current prices in the hope of selling later at higher prices, as the demand for shares will be higher. The investments that follow an inactive strategy do not differentiate between stock valuations, so they seek to obtain a specific percentage of the index.

    However, the market's ability to achieve a series of gains early in the month seems technically impossible because of the following: 1/ the given inflation of indicators and overbought in past sessions, 2/last month's session ended with an activity that increased the sellers for a period of time, losing most of the session's gains and unable to close above 7,700 points. The support levels for this month are at 7350 points, while the resistance is at 7930 points.


    * Economic Reporting Unit

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