Tadawul All-Share Index (TASI) declined on Sunday for the fifth consecutive session by -143 points (-1.3%), to close at 10,559 levels. Sunday's drop was driven by lower Brent crude oil prices and global markets indices. TASI opened the session negatively and continued its decline for the rest of the session, as it was trading in the range of 156. In general, 17 out of 20 sectors closed in the red zone, while 46 stocks rose and 171 fell. Banks (-1.5%), Materials (-1.6%), and Energy (-1.5%) sectors were the major drags on the index and contributed a total of -98 points. Stocks-wise, Al Rajhi Bank (-1.9%), Aramco (-1.5%), and Riyad Bank (-3.5%) pulled the index down the most. The trading volume activity increased by 24% DoD to reach 213mn shares, while the trading value declined by 7% DoD to reach SAR3.8bn. TASI likely will continue to declining due to the fluctuations in Brent oil prices as well as investors' cautiousness about the company's' financial results season.
The global equity markets are set to undergo a brief period of nervousness over the direction of interest rate following the latest economic data in the U.S. Last week proved to be a very happening period for the investors with policy decisions from three global central banks, economic data and results. Investors had become relatively confident and comfortable on the likely direction of interest rates and the timing of policy easing. However, the base view of the market is undergoing a shift once again and may produce more bouts of downside volatility. This particularly may apply to markets with a strong performance in near-term. In the U.S, the investors are likely to once again focus on FedSpeak , the minutes of the latest FOMC meeting and economic data to draw further guidance on the peak rate and the timing of policy easing. Major economic data due next week include consumer sentiment index and initial jobless claims.
In Europe, indices will likely digest the latest economic data in the U.S. A strong performance in recent session, currency movement and surprises in earnings season may force the market to show a more pronounced reaction.
In Asia, while the new update in the U.S remains a drag for at least in the initial part of week, investors will likely focus on data from China (strength of post COVID economic momentum) and Japan (currency) to make a view on future direction of the two largest economies in the region. Currency of Emerging markets in the region and Japan will be in limelight as yields in the U.S recover.