(MENAFN - Arab News) The Saudi stock market continued to show negative performance yesterday. The Tadawul All-Share Index (TASI) closed 32.31 points down at 8,740.74 after falling by nearly same points on Tuesday.
Over SR5.54 billion worth of shares changed hands yesterday.
Shares in the newly listed Saudi Arabian Mining Co. (Maaden) fell 3.47 percent after rising by over 50 percent on debut on Monday.
While commenting on the negative performance of the market, John Sfakianakis, chief economist of SABB (The Saudi British Bank), said "There is an obvious disconnect between the robustness of the economy and the performance of the stock market. The arguments put forward so far about the impact of the negative performance of the non-emerging global equities markets and the economic slowdown in the Organization for Economic Cooperation and Development and its relationship to the stock market in Saudi Arabia might not be well founded."
He added "Maybe the answer is far simpler: The stock market's full recovery from the 2006 crash might not be complete, in addition to valuations which in comparative terms to other regional markets command a higher premium."
TASI is down 20.82 percent so far this year after closing at 11,038.66 points on Dec. 31, 2007.
In order to boost transparency and disclosure best practices in the market dealings, and to provide the investors with essential information about substantial shareholders who own a large portion of the companies' shares, Tadawul will display the substantial shareholdings of the listed companies on Tadawul website from Aug. 16.
The list will display names of all substantial shareholdings who own 5 percent or more of each company's shares according to the records of the Depository Center at Tadawul. Those lists will be updated at the end of every day.
"Providing such essential information will enhance the level of investors' confidence and will enable them to make their appropriate investment decision, Tadawul said in a statement on its website.
Saudi Basic Industries Corp. (SABIC) shares increased slightly to SR129.50 yesterday. The Kuwait-based Global Investment House (Global) has assigned SABIC with a "buy" recommendation and based consolidated fair value of SR168.50, which offers a potential upside of 25.1 percent over the market price of SR134.75 per share as of July 27. To arrive at this consolidated fair value of the company, Global has assigned 80 percent weighted average to the discounted cash flows (DCF) based value and 20 percent to value derive from the relative valuation technique.
SABIC is expected to report a profit after tax of SR30.6 billion in 2008, a growth of 10.9 percent as compared to SR27.1 billion in 2007. Furthermore, the profitability is expected to increase at a CAGR of 7.5 percent, during 2007-2011. The return on average assets, on other hand, is expected to decline to 9.7 percent in 2011, which is mainly due to a time lag in the investment and commencement of production.
The return on average equity is also expected to dilute due to higher growth in equity as compared to profitability growth.
Along with its subsidiaries and affiliates, SABIC is the largest nonoil industrial group in MENA region. The principle activity of the company is to market and sell the petrochemical products of its affiliates/subsidiaries, under long-term marketing and sales agreements.
Meanwhile, about 569,000 subscribers have so far invested nearly SR430 million in Astra Industrial Group's initial public offering, according to Samba Capital, manager of the IPO. It said the IPO was oversubscribed by 153 percent, adding that more people purchased the shares on Tuesday compared to the first two days.
Nama Chemical Company announced on Tuesday that it had received the approval from the Capital Market Authority (CMA) to hold an IPO from Saturday for 12 days to increase its capital. It has offered more than 52 million shares for SR15 per share but the subscription will be limited to its shareholders.
The BMG Saudi Index ended yesterday's session descending slightly by 0.04 percent to 476.22 points.
The total turnover registered the fourth successive drop by 5.2 percent to reach SR1.3 billion (372 million), compared to SR1.5 billion (394 million) registered in Tuesday's trading session. Only the industrial sector gained more ground, moving up by 0.4 percent, whereas the agricultural sector witnessed no change in its closing level. The session's worst performer was the electricity sector, going down by 2.2 percent.
Only seven shares appreciated, whereas 15 shares depreciated. Dar Al-Arkan Real Estate Development Company emerged as the best performer, rising by 2 percent to SR50.75 per share. The worst performing share was Saudi Fransi Cooperative Insurance Company, falling by 3.8 percent to SR82.