The Tadawul All-Share Index (TASI), which has surged around 12 percent since regulators announced plans to liberalize the Saudi stock market for foreign investment, closed above the 11,000-point mark on Wednesday.
"The market continues to attract fresh liquidity which is positive for the uptrend in the medium term," commented
"Reaching 11,500 is an important level which should be reached later this year," he told
Expectations of strong global demand for petrochemicals supported the uptrend the
The index is up 29.22 percent so far this year.
"I expect there will be volatility in the Saudi stock market in the remaining part of the year," commented Said Al-Shaikh, chief economist at the
"I don't think the index will continue to rise indefinitely. But I think there will be some correction and profit-taking throughout this period until the end of the year," Al-Shaikh said.
He made these remarks on the sidelines of the launch of the third quarter NCB and Dun & Bradstreet Business Optimism Index (BOI) report in
Al-Shaikh added: "Last year, the Tadawul index was up 25 percent due to economic fundamentals and developments in the global economy. The Dow index was up 29 percent. So, it was not a surprise that
Commenting further on the latest market developments, Sfakianakis added: "The next earnings cycle will determine what levels it tests and how quickly."
He said the petrochemical sector, which rose 1.84 percent on Wednesday, has been a recent favorite after certain banks have seen a renewed rally.
"The upswing has been happening on the back of few corporate news and as oil has been treading lower," he said.
"The view of local investors seems to be geared by momentum that seems to be gaining pace as news of the opening up of the market is still the main reason for the bullish trend."
Asked about Tadawul's future direction, he said: "Although it's difficult to say exactly, looking at the general positive investor sentiment combined with the favorable domestic macro-economic climate, and improving global economic environment, it's not beyond the realms of possibility that the
According to reports, petrochemicals were among the main drivers on Wednesday.
A number of Saudi banking stocks, which had posted strong gains over the last few weeks, pulled back on Wednesday.
The powerful trading waves on Wednesday expanded Tadawul's volume to 493.5 million shares, an increase of 109.4 percent over the 50-day average of 235.7 million shares.
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