Saudi stocks fell to break 7500 points to close at 7493 points, down 31 points, 0.4 percent. The pressure came from the banking sector with a concession, which is declining despite its positive results. However, the appearance of differences in the calculation of the Zakat and the application of Accounting Standard No. 9 had a negative impact on the shares of the sector. These events are not new; the differences in the calculation of the Zakat container has been disclosed by banks in previous reports and the new accounting standard was adopted in 2014, but this year is the first year in its application. In addition, these events did not circulate and spread only recently, which had a negative impact and limitation on stock prices.
With regard to accounting standard 9, the additional provisions of the application of the Standard are against good debts that are not currently likely to be impaired. It is a measurement that emerged after the global financial crisis and was intended to reduce the financial shocks caused by economic cycles, which means that often those allocations will not turn into debt and then loss. The general index has lost 7500 points, and in today's session it should maintain 7450-7500 points so as not to slip into another wave of profit taking to 7360 levels, which could extend to 7200-7230 points.
The market continues to enjoy positive factors from a decline in profitability, especially in the banking sector, and to improve the market's profitability for companies announced so far, and to increase the opportunities for the local index to join international indices.
Overall market performance
The general index opened at 7525 points, trading between high and low. The highest point was at 7553, 0.38 percent, while the lowest point was at 7487 points, 0.5 percent. At the end of the session, the general index closed at 7493 points, losing 31 points, 0.4 percent. Liquidity declined 5 percent by about 159 million riyals to 3.1 billion riyals, 32,000 riyals per transaction. While traded shares increased by 7 percent by about 9.8 million shares to reach 152 million traded shares, with a turnover rate of 0.29 percent. Transactions fell 2 percent to reach 97,000 transactions.
Nine sectors fell against the rest of the rest. The decline was led by "Consumer services" by 1.5 percent, followed by "banks" by 0.9 percent, and "health care" by 0.76 percent. While the increase was led by "pharmaceuticals" that rose by 1.7%, followed by "capital goods" by 0.9%, and "investment and finance" by 0.85%.
The highest turnover were "Real Estate Management and Development" with 20 percent with a value of SR 633 million, followed by "Basic Materials" with 20 percent with a value SR 607 million, and then "Banks" with 20 percent with a value of SR607 million.
The highest performing shares were SIECO, which closed at SAR 266.60, followed by Amana Insurance by 9.47 percent to close at SAR 21.74, and then SARCO
that fell 4.55 percent to close at SAR 36.98.
On the other hand, the decline was led by Al Hokair Group that decrease 6.22 percent to close at SAR 21.40, followed by eXtra by 3.3 percent to close at SAR 56.27, and Arab National by 2.6 percent to close at SAR 27.20.
Dar Al Arkan had the highest turnover of SAR 576 million, followed by Alinma with SR370 million at 12 percent, and then SABIC with SAR253 million at 8 percent.