Tadawul Review:

Tadawul All share Index (TASI) declined by 191 points (-‎‎1.6%) on Wednesday to settle at 11,893 levels. The volatility ‎in international markets was the major reason for the decline ‎in TASI. Investors’ nervousness was evident from the word go ‎as the index opened with a significant gap (-‎‏213‏points). The ‎index managed to pare losses to -116 points only to resume ‎decline towards the session close. In general, all sectors were ‎closed in the red zone, with only eight companies managing ‎to close the session in green. The banking sectors (-‎‎2.1%), ‎materials (-2.0%) and communications (-1.3%) were ‎the major drags on the index. The trading value increased by ‎‎2% to reach 5.4 billion riyals, while the trading ‎volume ‎decreased by -11% to reach 122 million shares ‎compared to the previous day. Oil prices have held the ‎ground despite concerns on global economic recession ‎‎(Brent: +‎‏1‏‎%) while the U.S markets have shown relative ‎stability at session close. TASI may look to consolidate around ‎the 12,000 mark.

 

 

 

Market Wrap International:

The global equity indices painted a gloomy picture on ‎Wednesday, a day after the release of above-expected CPI ‎data in the U.S. An uneasy calm prevailed in the U.S as ‎investors drew comfort from the release of another yardstick ‎of inflation, the Producer Price Index, which showed easing of ‎pricing pressure. The benchmark indices posted modest ‎rebound with S&P 500 and Nasdaq Composite rising by ‎‏%0.3‏‎ ‎and‏0.7 ‏‎%. The gains were. However, quite narrow as only six ‎out of eleven sectors gained with energy and consumer in the ‎lead. Tech stocks relatively underperformed for the session ‎despite heavy battering in the previous session. The yields on ‎the U.S treasuries broadly retreated, paring early morning ‎advance.‎

In Europe, the investors digested the full impact of the market ‎decline in the U.S in the previous session. Meanwhile, concerns ‎on energy supply issues and recession took center stage. The ‎benchmark Stoxx Euro 600 Index fell another 0.9% on ‎Wednesday, translating into cumulative decline of ‎‏2.4‏‎% in the ‎past two sessions. Key country level indices moved in the same ‎direction and were down in the range of 0.4-1.5%.‎

Asian market absorbed the full impact of yesterday's data ‎release in the U.S and the significant drop in key indices in the ‎U.S and Europe.  Barring SENSEX in India (little changed), all ‎major indices fell in the range of 0.8-2.‎‏8‏‎%. The growing risk of ‎recession and the prospects of aggressive monetary tightening ‎both in the U.S and Europe have increased pressure on FX ‎‎(JPY fell close to levels seen only 1998 before paring losses) ‎and hurt export-oriented sectors in the region. ‎‎‎