Saudi leads Gulf declines after global selloff

Date

10/1/2015 11:34:39 PM

(MENAFN- Khaleej Times)

Saudi Arabian stocks led a drop across all Gulf equities following an international selloff as the kingdom's market reopened after a public holiday.

The Tadawul All Share Index the benchmark gauge of Opec's biggest oil producer fell 1.4 per cent to 7337.21 at the close in Riyadh. Al Rajhi Bank led the retreat with a two per cent slide. Qatar's QE Index lost 1.4 per cent Abu Dhabi's ADX General Index retreated 0.9 per cent and Dubai's DFM General Index declined 0.8 per cent.

"With global markets selling off regional markets are following suit" Ramez Merhi a Dubai-based director at Al Masah Capital Ltd. which manages $500 million said by e-mail. "Recent commodity market weakness is taking its toll. With Glencore taking a big hit and our markets being significantly linked to energy investors are following suit in selling risk assets reducing commodity exposure and raising cash." While global stocks showed signs of stabilizing on Tuesday about $800 billion was wiped off shares a day earlier amid a selloff in commodity and biotechnology companies. Glencore Plc a commodity trader saw its value slashed by about a third yesterday amid concern over its debt and waning demand for raw materials. Government budgets in the six-nation Gulf Cooperation Council rely on income from oil the price of which has dropped by more than half in 12 months. Saudi Arabia withdrew as much as $70 billion from global asset managers as the price of oil fell and its budget deficit widened Insight Discovery a financial services market intelligence company said this week.

The three biggest decliners in the kingdom were banks. Alongside Al Rajhi National Commercial Bank dropped 1.6 per cent and Banque Saudi Fransi slipped 2.7 per cent.

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