Strong recovery in the Saudi stock market
The Saudi stock market witnessed a significant surge during today's trading session, with the Tadawul All Share Index (TASI) recording a notable increase of 2.3%, closing at 11,339 points. This rise represents an increase of 251 points, marking its highest closing level in over two months. This rebound was accompanied by strong liquidity, with total trading value reaching approximately SAR 8.4 billion, reflecting considerable optimism among investors. During the session, the index fluctuated between a high of 11,339 points and a low of 11,215 points.
The geopolitical context and its impact on markets
These strong gains followed positive geopolitical news, as markets reacted to the agreement reached between the United States and Iran for a two-week ceasefire. This agreement was contingent upon the crucial condition of the full, immediate, and safe reopening of the Strait of Hormuz. Historically, the Strait of Hormuz is one of the world's most strategically important waterways, through which a significant portion of the world's oil supply passes. Therefore, any de-escalation of tensions in this vital region has a direct and immediate impact on the stability of regional and global financial markets, and increases the risk appetite of both foreign and domestic investors.
Performance of the parallel market and leading stocks
On the parallel market, Nomu, the index rose by 1.5% to close at 22,633 points, an increase of 344 points, with trading volume reaching nearly SAR 26.5 million. In the main market, blue-chip stocks led the gains, with Al Rajhi Bank, which has the largest weighting in the index, rising by 3% to SAR 107.70, amid active trading exceeding 6 million shares. This performance reflects the strength and resilience of the Saudi banking sector in the face of challenges.
Shares of other major companies also recorded significant gains, with ACWA Power and Ma'aden rising by 8% to close at SAR 173.50 and SAR 70, respectively. In the financial and telecommunications sectors, shares of National Commercial Bank, Sulaiman Al Habib Medical Group, Alinma Bank, STC, Etihad Etisalat (Mobily), Alawwal Bank, and Bank Albilad all rose by varying percentages ranging from 1% to 4%.
Corporate results and the impact of oil prices
Some stocks reacted positively to the first-quarter financial results announcements, with Extra shares closing at SAR 82.40, up 3%, and Tasheel shares closing at SAR 126.50, up 2%. Other stocks that saw gains of between 8% and 10% included Flynas, Riyadh Cables, United Insurance, Al-Asmak, Gulf General, Al-Kimiya, Qaw Telecom, and Research and Media.
Conversely, despite the overall positive market sentiment, Saudi Aramco shares were impacted by the decline in global oil prices, falling by 2% to close at SAR 26.98. Cisco Holding shares topped the list of decliners, dropping by 8%. This divergence in performance highlights the dynamism of the Saudi market and its ability to absorb global and local economic changes, supported by the Kingdom's Vision 2030 programs, which aim to diversify the economy and reduce reliance on oil revenues, thus enhancing the market's attractiveness as a leading investment destination in the Middle East.
