Saudi investors diversify sector holdings

The Saudi stock market concluded a volatile week with significant declines, as the TASI index dropped by 2% to close at 10,590 points, recording its largest weekly loss in three months. The losses were driven by internal factors, including mixed corporate earnings results, fluctuations in liquidity costs, and trading in shares without entitlements to dividends, with leading stocks heavily influencing the overall performance of the index. Despite the market decline, weekly trading value rose by 10.3% to approximately 20.55 billion Saudi riyals, reflecting investors' reallocation of their positions across sectors and reevaluation of companies based on their financial results. Liquidity costs decreased following the Federal Reserve’s decision to hold interest rates steady, with the 3-month SIBOR falling to 4.87%, which supported a rebound in the banking sector during the last session, although most bank stocks continued their weekly decline. The market was also affected by company earnings; for example, SABIC’s stock fell by 6.2% after quarterly losses, while other stocks such as Solutions and Americana rose. The market displayed a clear selectivity between companies with good and poor results, with demand for stocks at lower levels persisting despite intense pressures. Thursday’s rebound helped recover part of the week’s losses, but it does not indicate a change in the overall trend, as the market remains under broad reevaluation pressure. A broader recovery and improved results from major companies are needed to boost confidence and restore stability.

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