Saudi stocks closed for a third session in a row to close at 7465 points, losing only 6 points, in the lowest losses recorded by the market in the last three sessions with increased liquidity and limited support levels of 7450 points.
The session witnessed the market trading in the Green Zone, which shows the interest of buyers at the current price levels. If this interest continues, the market today will maintain the current levels and start forming a new rally, supported by the positive results of the companies such as Tasnee. This confirms investors' interest in the market when positive incentives appear or surprise their expectations.
The banking sector is still trading with low profitability, although the sector has achieved positive results, making it able to lead any market reversals. The petrochemical-led material sector will play a supporting role due to the improved prices of its products. The market is approaching March, when the financial results of the companies will be announced. It is also possible to announce that they will join the FTSE Russell index, which will make the pace of activity increase during the coming period. Such incentives could prevent the market from slipping into a downward spiral if oil prices return to consolidation, as it fell more than 1% during the session yesterday after the closure of the domestic market. The continuation of the decline of oil will lose the appetite of traders, which will push the market to break the support. In turn, this does stop loss and increase selling pressure, which will end at 7360 points.
General Market Performance
The general index opened at 7471 points, between high and low. The highest point was at 7491 points, gaining 0.27 percent. While the lowest point was at 7461 points, losing 0.15 percent. At the end of the session, the general index closed at 7465 points, losing six points. Liquidity rose by 4 percent to 106 million riyals to reach 2.8 billion riyals, at a rate of 31.5 thousand riyals per transaction. While the traded shares increased by 4%, about 3.8 million shares to reach 3.8 million shares traded, with a turnover rate of 0.22%. Transactions fell 5 percent to 89,000 transactions.
Eight sectors rose against the rest. The increase was led by "Energy" that was up 2.1%, followed by "business and professional services" by 2%, and "communications" by 0.6%. While the decline was led by "Investment and Finance" that was down by 2.2%, "Insurance" by 1.45%, and "Food Production" by 0.84%.
The highest turnover was the "Basic Materials" (34%) amounting of SR 945 million, followed by "Banks" amounting to SAR 603 million (21%), and "Insurance" (8%) with SR 232 million.
"Tasnee" led the increase with the maximum closing at 17.8 riyals, followed by "Medgulf Insurance" for the maximum closing at 25.20 riyals, and then "Mepco" by 4.6% to close at 25.15 riyals. On the other hand, "Asir" led the decline with the maximum closing at SAR11.16, followed by "Tawuniya" by 4.5 percent to close at SAR 68.72, and "SARCO" for 4 percent to close at SAR 34.56. Alinma was the top performer with 11 percent trading at 319 million riyals, followed by SABIC at 305 million riyals at 11 percent, and then Al Rajhi with 8 percent at 219 million riyals.
* Economic Reports Unit