Tadawul Review:

Tadawul All Share Index (TASI) declined for the second consecutive day losing 66 points (-0.5%) to close at 12,596 levels. TASI opened with a positive gap but thereafter succumbed to selling pressure to gradually decline throughout the day. Sector-wise, the index drop was led by Banks (-0.8%), Materials (-0.7%), and Telecom (-0.9%) while among the stocks, Al Rajhi (-1.2%), SNB (-0.8%), and Alinma Bank (-1.9%) dragged down the index. Petro Rabigh (+6.7%) and Sharqiyah (+5.0%) were the biggest gainers for the day. Overall, trading activity slowed down further with volume and value traded declining by 7% and 6% to 141mn shares and SAR5.6bn respectively. TASI remains very volatile, however, elevated Brent prices (above USD121/bbl levels) might provide some respite in the near term.

Market Wrap International:

US markets fell on Thursday as rising oil prices fueled inflation fears, and investors positioned themselves ahead of Friday's crucial inflation report. The S&P500 fell -1.08%, with energy being the only positive sector (+0.15 percent), while drops in technology (-1.11%) and financials (-1.70%) weighed the most on the index, with 90% of companies finishing lower. The Dow Jones fell -0.81%, while the Nasdaq Composite fell -0.73%. The OECD reduced its global growth prediction for 2022 to 3% from 4.5% in December, while increasing its inflation forecast for member countries to 9%.

European markets were also down as investors awaited the ECB policy meeting tonight. While no interest rate adjustments are expected, the central bank is likely to declare the end of asset purchases and detail the route to rising rates. Futures markets predict a +0.27% hike at the July meeting, but given that other major central banks have lately surprised with larger-than-expected increases, a similar move should not be ruled out, especially given that inflation has climbed by +8.1% year to far. The Euro Stoxx 600 fell -0.57%, as did the DAX, -0.76% and CAC by -0.80%.

Asian markets advanced on Wednesday as the Chinese government approved 60 new game licenses indicating that a year-long Tech. crackdown might be finally over. The move comes after the report that China is wrapping up its investigation into Didi Global earlier this week. Consequently, the SH Composite and Hang Seng rallied by 0.7% and 2.2% led by Alibaba Group Holding and Bilibili Inc. In Japan, Nikkei 225 closed up by 1.0% while KOSPI ended flat.