The Saudi stock market performed strongly as it gained over 11 percent in the first half of this year.
The Tadawul All Share Index (TASI) closed at 7,496.57 points, gaining 786.66 points or 11.72 percent over the close of the same period of the previous year. On an YTD basis TASI registered a positive increase of 10.22 percent or 695.35 points. Highest close level for the index during the period was 7,645.65 points as on June 6, 2013, according to Tadawul’s report.
John Sfakianakis, chief investment strategist at Masic in Saudi Arabia, said: “Performance has been good compared to the massive sell off in most of the emerging markets. There is momentum into the local market but volatility has increased. Given that the fundamentals are strong even if some of the valuations are rising, the stock market should do well especially on the back of good results from banks.”
He added that petchems will be watched carefully given concerns of a slowdown in China even as oil prices remain resilient and they are expected to do so during the rest of the year. “Barring any global corrective event or geopolitical concerns, the stock market should perform well,” Sfakianakis said.
The report said total equity market capitalization at the end of the first half reached SR 1.50 trillion ($ 399.23 billion), increasing by 11.96 percent over the end of the 1st half of the previous year.
The total value of shares traded reached SR 760.81 billion ($ 202.88 billion), decreasing by 38.97 percent over the same period of the previous year.
Commenting on the Tadawul report, Jarmo T. Kotilaine, a regional analyst, said. “The performance of Tadawul was generally very solid. While the index may not have been the regional star performer, it made sustained progress. This reflected both the strength of the Saudi economy and the positive sentiment in the global markets during much of this period, even if a large element of that was linked to unconventional monetary policy.”
However, Kotilaine said: “The main negative aspect during H1 was the pronounced drop in trading volumes, which stands in contrast to the strong gains seen last year.”
The total number of shares traded reached 28.93 billion during the first half of this year compared to 56.37 billion shares traded during the same period of the previous year, decreasing by 48.67 percent.
The total number of transactions executed during the 1st half of this year dropped 31.80 percent to reach 17.66 million compared to 25.89 million trades during the same period of the previous year.