Tadawul Review:

Tadawul All Share Index’s (TASI) slump entered its third day with the market declining by 0.8% to close at 12,236 levels. The index remained choppy from the start and recorded a steady decline throughout the day. This is TASI’s lowest closing since 14th Feb 2022. Banks (-1.0%) led the market decline contributing 44 points followed by Materials (-1.8%) and Food & Beverages (-3.0%) contribution of negative 34 and 11 points. Al Rajhi, SABIC, and BSFR were the major drag on the index declining by 2.3%, 3.4%, and 4.1% respectively. Arab Sea Information recorded the biggest loss for the day of 7.3% while Saudi Industrial Export (+9.9%) and Saudi Marketing (+9.8%) were the major gainers. Trading volumes and value came down sharply to 179mn shares and SAR7.5bn due to Kingdom holding’s negotiated deal yesterday.

Market Wrap International:

Stocks surged on a risk-on day for markets, with mood raised after Vice President Joe Biden said that the Trump administration's tariffs on China may be reconsidered, as well as an upbeat prognosis from JP Morgan and more hints of Chinese stimulus. In addition to President Biden's statements on rethinking Chinese tariffs, China will grant more than $21 billion in further tax relief to balance the impace from severe COVID lockdowns. JP Morgan led increases among banks in the S&P500 after raising its interest income projection and reiterating its profitability objective at its investor conference. The S&P500 climbed +1.86% with 84% of stocks advancing as financials +3.23%, energy +2.68% and technology +2.37% led gains. The Dow Jones also gained +1.98, as did the Nasdaq Composite +1.59%.

ECB President Christine Lagarde said the central bank is expected to start raising interest rates in July and depart the sub-zero region by the end of September, propelling European shares higher after initially paring gains. With 78 percent of equities increasing and all sectors positive, the Euro Stoxx 600 gained +1.26, headed by energy +2.03%, financials +1.93%, and technology +1.91%. With benchmarks widely up across the area, the DAX gained 1.38%, the CAC 1.17%, and the FTSE100 1.67%. The week ahead is jam-packed with important European statistics, including PMI surveys for Germany and the Eurozone today, the final reading of German GDP for Q1 on Wednesday, and consumer confidence for June.

Asian markets were mixed on Monday as investors weighed on Chinese authorities' efforts to support the economy and the ongoing COVID-19 situation. SH Composite slid initially, after Beijing reported a record number of cases, raising concerns for fresh lockdowns. However, the market recovered to close flat. In Hong Kong, the Hang Seng closed red, declining by 1.2%. KOSPI, in S. Korea, managed to rise by 0.3% after the US and S. Korea presidents agreed to improve cooperation in several areas including semiconductors, batteries, EVs, etc. In Japan, Nikkei 225 inched up by 1.0% while SENSEX, in India was down 0.1%.