(MENAFN - Arab News) Saudi stocks rebounded from a five-day slump on Wednesday as banks rose on strong earnings.
The TASI index rose for a first session in six, closing 0.3 percent higher at 7,573.28 points.
Al-Rajhi Bank rose 3.9 percent, SABB added 1.7 percent and Banque Saudi Fransi gained 2.7 percent. These banks reported first-quarter net profit growth of between 10 and 18 percent.
Saudi Hollandi Bank up 2.5 percent, posted a 21.9 percent rise in net profit and Aljazira Bank rallied 2.8 percent as earnings more than doubled.
"This reflects the situation that we have been experiencing for some time. The Saudi stock market and economy are strong but the global situation fragile," said Jarmo T. Kotilaine, chief economist at the National Commercial Bank, commenting on the Tadawul's performance.
Kotilaine added: "The bank earnings reflect the resilience of the domestic economy and the favorable momentum in terms of growth. But the global story repeatedly challenges the Saudi narrative. When the news flow is Saudi focused, that tends to be positive for the markets, when it shift to the global crisis, the optimism is challenged."
Basil Kabbani of Zughaibi & Kabbani Financial Consultants said: "Perhaps recent handsome financial results of Saudi banks redirect investors' attention to play actively."
Also yesterday, a new report said Saudi Arabia's gross domestic product grew 6.64 percent from a year earlier in the fourth quarter of last year, accelerating from 5.1 percent growth in the third quarter.
The oil sector, which accounts for nearly a third of the economy, expanded 6.13 percent in the fourth quarter, the Central Department of Statistics and Information in Riyadh said in a report yesterday.
The oil sector GDP rose to SR82.66 billion in the fourth quarter of 2011.
The report said private sector growth, at 9.9 percent, outpaced the state sector's 3.6 percent expansion. Private sector GDP amounted to SR112.91 billion in the fourth quarter compared to SR102.75 billion in 2010.