Tadawul All-Share Index (TASI) closed Monday's session down for the third day in a row, shedding -305 points (-2.8%). The broke the 10,500 level and settled at 10,419, its lowest closing level since May 18, 2021 (10,424). TASI opened the session at the same level as the previous one, but was soon exposed to strong selling pressure, causing it to decline dramatically for the rest of the session, closing at its intraday low. In general, all sectors closed in the red zone, while 20 stocks rose and 187 declined. Banks (-3.8%), Materials (-1.6%), and Energy (-2.2%) sectors were the major drags on the index and contributed a total of 193 points. Stocks-wise, Al Rajhi Bank (-3.8%), Aramco (-2.1%), and Saudi National Bank (-3%) pulled the index down the most. The trading activity witnessed an improvement in volume and value by 36% and 43%, respectively, to reach 117mn shares and SAR4.1bn. TASI has dropped ~24% from its peak. The technical indicators remained oversold though the momentum is negative.The index can take support at current levels amid intraday volatility.
The global equity indices moved in divergent directions on Monday with investors assessing the prospects of further rate hikes, risk of further tightening if energy supplies in Europe and incremental progress on the economic reopening in China. In the U.S, the benchmark S&P 500 Index and Nasdaq Composite retreated by. -1.8% and -1.9% on Monday. A strong rally in the key indices from recent lows have made investors more cautious ahead of another FOMC meeting due next week and important economic data releases. Consumer Discretionary and Energy were the worst performing sectors for the session.
In Europe, the drop in temperature in the region has reignited concerns on energy supplies as the region enters into the peak winter season in coming days. Energy prices remained steady despite a latest decision by the OPEC+ to leave the output unchanged. The Stoxx Euro 600 Index dropped by -0.4% at session’s close on Monday. The county-level indices exhibited mixed trends with FTSE-100 recording gains of 0.1% while DAX and CAC40 falling by -0.6% and -0.7% respectively.
In Asia, easing of COVID-19 restrictions and economic reopening remained a dominant theme in the region. The equity indices in Hong Kong (HangSeng: 4.5%) and China (Shanghai Composite: +1.8%) posted yet another performance as investors celebrated easing of requirements of COVID testing in major cities. Indices in Japan (TOPIX: -0.3%) and Korea (KOSPI: -0.6%) closed in red.