(MENAFN - Arab News) Saudi stocks closed slightly higher yesterday after the government announced a 2013 state budget, which analysts said was likely to support continued strong economic growth next year.
The Tadawul All Share Index gained 0.2 percent, the most since Dec. 22, to 6,877.06 at the close.
The market declined early on in response to a drop in global oil prices on Friday, but rebounded after the budget details were released.
Analysts, quoted by Reuters, said the budget announcement was not a surprise, but it was seen as mildly positive for domestic demand-related stocks.
The market gained, even though petrochemicals fell slightly in response to the global picture, with Saudi Basic Industries Corp (SABIC) down 0.3 percent.
The Saudi index has gained 7.2 percent this year after falling 3.1 percent in 2011.
Samba Financial Group (SAMBA) rose the most yesterday since Dec. 19. Kingdom Holding Co. closed at the highest level since March 2008, said a Bloomberg report.
"Although external factors might seem negative due to the US fiscal cliff, Saudis are enthusiastic about the Saudi fiscal budget for this year which is affecting the market in a positive manner," Mohammed Al-Omran, financial analyst and president of the Gulf Center for Financial Consultancy in Riyadh, was quoted as saying in the Bloomberg report.
The Standard & Poor's 500 (SPX) Index dropped 1.9 percent last week, the biggest such decline in almost two months, as investors await the outcome of budget talks by US lawmakers to avert the so-called fiscal cliff.