Saudi stocks start the week’s trading with a trigger for a rebound in the price of oil
The listed companies enter the period of the last days to announce the financial results
Sunday – Rajab 20, 1441 AH – March 15, 2020 AD number number [
Saudi stocks recorded their biggest decline since 2011 during trading last week (Reuters)
Riyadh: Shuja Al-Baqmi
Today, the Saudi stock market will resume its trading on Sunday, amid optimism about a more positive performance than was the case in the past three weeks, where the positive rise of global markets and oil on Friday is expected to boost the gains of Saudi stocks on the one hand, as it is expected to be The positive announcements that listed companies started announcing regarding the results of the last quarter of 2019 are an important catalyst for the performance of these companies on the other hand.
In this regard, last Friday, the American financial markets recovered all their losses, which were suffered on Thursday, while oil succeeded in compensating a large part of its losses as well.
The Saudi stock market is one of the most stable and balanced global financial markets during the past few years, and at the same time it is one of the most able to attract investment capital significantly and growing, which pushed the proportion of foreign investor ownership to record unprecedented levels .
The Saudi stock market, which entered the list of the 10 largest financial markets in the world after listing a portion of the shares of the global oil industry giant, Saudi Aramco, succeeded last week in closing above 6300 points, as the market index maintained this level at the close, which paves the way To establish an important and reliable technical support point in the next few days.
Traders are awaiting the announcement of the giant of the oil industry, Saudi Aramco, for its financial results for the fourth quarter of 2019, while they are also watching the financial results of more than 100 other listed companies, while about 93 other companies announced their financial results, including companies announced after the closure on Thursday. Last year, a good growth in the profits of the last quarter of 2019, compared to the same quarter of 2018.
According to the results of 93 companies, these results showed an improvement in the financial performance of 61 companies (representing 65.5% of the number of declared companies), most of which companies recorded growth in profits, including companies that showed better financial performance by significantly reducing the severity of losses, by recording performance Operating and revenue is more dynamic and positive.
In this regard, the Saudi stock market index ended the trading of the last week, with a decrease of 14.9%, equivalent to 1110 points, thus closing at 6357 points, compared to the previous week’s closing at 7468 points, continuing its decline for the third week in a row.
The losses of the Saudi stock market last week are the largest in percentage terms since February 2011, when they reached 15.02%, and the largest in terms of points since October 2014, when they reached 1304 points, while these declines come less than the level of losses Many of the global financial markets, which witnessed a wave of sharp declines last week, reach a range of 30% due to fears of the spread of the Corona virus.
It is expected to increase the pace of the announcement of the Saudi companies listed in the local financial market transactions, about their financial results during the coming days, while the period of companies ’announcement of their annual results is expected to end on March 31.
In terms of cash circulating, the value of total trading during the last week’s transactions increased significantly, reaching about 33.67 billion riyals (8.97 billion dollars), compared to about 21.84 billion riyals ($ 5.82 billion) in the previous week, registering an increase of 54 %.
In spite of the anticipation and caution data for the souls of traders in the global financial markets trading with the expansion of the “Corona” outbreak and the increasing size of fears of the impact of the global economy, an expert in the analysis of financial markets expected that the performance of the Saudi market and the Gulf markets in general will be significantly dependent on the results of the performance of oil prices .
Faisal Al-Oqab, a specialist in analyzing financial markets, believes that the performance of Gulf stocks during these days depends more on the cohesion of oil prices above $ 30 a barrel, noting that if oil succeeds in that, the markets will start to recover slowly.
Al-Oqab added: “We do not lose sight of the developments in the global financial markets, but the biggest factor is the oil prices in the first place.” On the other hand, the Saudi companies listed in the local financial market are still living in the period of announcing the results of the last quarter of 2019. This comes at a time when investors hope that the results of companies will be paid from the level of positivity in the local market transactions, which contributes to renewed opportunities Investment and increases its attractiveness.
Faced with these developments, investors await the financial results of the rest of the companies listed in the local market dealings, with the aim of building investment decisions related to strengthening their positions in certain shares, or exchanging these centers by switching from one share to another.
It is noteworthy that the net profits of Saudi companies listed in the Saudi stock market (excluding Saudi Aramco) during the first nine months of 2019 amounted to about 64.7 billion riyals ($ 17.2 billion).