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MENAFN - Arab News - 09/01/2010

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(MENAFN - Arab News) Saudi shares gained fresh ground at the beginning of the new year, apparently buoyed by expectations as to the performance of listed firms in 2010. The Tadawul All-Share Index (TASI) climbed 2.27 percent last week, closing at 6,260.90 points.

The Saudi market drew momentum mainly from the petrochemical and banking sectors, particularly SABIC (Saudi Basic Industries Corp.), Samba Financial Group and Al-Rajhi Bank, the Riyadh-based Bakheet Investment Group (BIG) said in its weekly report. SABIC shares surged by 5.45 percent to SR87, Samba by 4.46 percent to SR52.75 and Al-Rajhi Bank by 1.05 percent to SR72 last week.

The top gainer last week was Al-Sagr Cooperative Insurance Co. as its shares jumped by 12.15 percent to SR60. The other major gainers were Alujain Corporation (10.50 percent), Kingdom Holding Company (9.57 percent), National Industrialization Co. (8.19 percent) and Etihad Etisalat Co. (7.14 percent).

The Insurance sector suffered badly last week. Weqaya Takaful Insurance and Reinsurance Company shares plunged by 19.32 percent to SR40.10, Arabia Insurance Cooperative Company by 8.24 percent to SR25.60, Gulf Union Cooperative Insurance Company by 8.04 percent to 26.30 and SABB Takaful by 7.14 percent to SR31.20.

The stock market turnover fell to SR11 billion last week compared to SR13.95 billion in the previous week.

The BIG expected the Saudi market to witness "quiet trading sessions" this week as investors await the publication of annual profits.

The Jeddah-based National Commercial Bank (NCB) said in its weekly market review that 2009 was a busy year for the Saudi equity market. Eleven new companies were floated in the primary market through initial public offerings (IPOs), with a combined offer size of 338.7 million shares worth SR3.88 billion, giving an overall average offer price of SR11.46 per share.

Of these, seven firms were insurance companies and the rest were from the Telecom and IT, Petrochemical, Retail, and Building and Construction sectors. With a share capital of SR7.79 billion, the 11 companies lifted 49.8 percent of their combined total from the primary market and founders and institutional investors subscribed the residual. The NCB report said of the eleven floated firms, stocks of nine firms started trading at Tadawul, while those of four are expected to start trading in the first quarter of this year.

Measured in terms of market capitalization, the market response was impressive as the share prices of the newly listed firms together rose 325 percent until Dec. 31, 2009, compared with the 27.5 percent gain recorded for the entire market.

Arab stock markets closed first week of 2010 higher as investors monitored any clues to the 2009 annual results to decide their new positions, financial analysts said Friday.

They pointed out that the movement of oil prices, plans for rescheduling the Dubai World debts and the recovery news of the world's leading economies would continue to influence decisions of Middle East investors.

"I believe regional investors prefer to take a wait-and-see approach at this juncture pending the release of 2009 results and dividends, particularly of blue chips," Wajdi Makhamreh, CEO of the Amman-based Noor Investments brokerage, said. "We think that Arab stock markets, particularly in the Gulf region, will continue to be responsive for movement of oil prices and come under psychological pressure from what happens on global bourses as well as reports about the world recovery."

Jordanian shares also closed higher last week with traders keeping an eye on the new government's steps to fight corruption and deal with the local ramifications of the global financial crisis, Makhamreh said.

"The image is still unclear in the light of the moves taken to address the stagnation in the real estate and industrial sectors," he added.

The all-share index of the Amman Stock Exchange gained 1.21 percent last week, closing at 2,564 points, according to the ASE weekly report.

Kuwait's KSE all-share index edged higher, closing at 7,012 points compared with the earlier week's close at 7,005 points.

The United Arab Emirates stock exchanges of Dubai and Abu Dhabi also scored gains last week, apparently making benefit from the inauguration of the world's tallest skyscraper, Burj Khalifa, analysts said.

The benchmarks of Dubai and Abu Dhabi went up by 1.8 percent and 1.1 percent to close week respectively at 1,837 points and 2,775 points.

Egypt's AGX30 index, measuring performance of the market's 30 most active stocks, gained 3.7 percent last week, closing at 6,437 points.

The GulfBase GCC Index increased by 1.64 percent to 3,787.26 points last week. The value of GCC traded shares, however, fell by 9.62 percent to 5.22 billion and volume surged by 10.34 percent to 4.15 billion of shares.

By Khalil Hanware & Abdul Jalil Mustafa


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