Tadawul Review:

Tadawul All Share Index (TASI) lost 86 points (-0.7%) on Monday to close at 11,427 levels. The session started with a positive gap of 60 points, however, after touching a high of 76 points during the first trading hour, the the index changed its course and shed 182 points from its high. The Real Estate sector (-4.5%) was the major culprit in pulling the index down by -17 points followed by Materials (-0.9%) and Banks (-0.3%) cumulatively dragging the index down by 28 points. Saudi Fransi (-3.0%) and Saudi Telecom (-2.0%) were a major drag on the index while Dar Al Arkan, Arab Sea, and Saudi Industrial Export were the top losers for the day all closing at their lower circuit of 10.0%. Overall, trading activity improved with volume and value rising by 22% and 25% to 190mn shares and SAR6.5bn. The market continues to remain choppy with investors booking short term gains.

 

Market Wrap International:

Global equity indices picked up from where they left off last week driven as valuation, tech stocks and easing of COVID-19 related restrictions remained the dominant themes. In the U.S, the market showed sideways moves to post a significant move in the last few sessions. The yields on U.S bonds were bid up and took the shine off the equity indices with S&P 500 and Nasdaq Composite dropping by -0.3% and -0.7% despite future contracts on the indices showing a positive move in Asian trading.

In Europe, valuations once again remained a key driver for the benchmark Stoxx Euro 600 Index which rose 0.5%, down from an intraday high of 1.2%.  A steep correction in the stock in preceding sessions and no new negative news flow, has pushed back concerns on recession in the region for now. Mining stocks were in the lead. Important data on inflation and unemployment is due later this week and may put fresh pressure on stock prices.

The Asian markets moved up in perfect unison driven by tech and COVID-19 easing plays in China. Taiwan and Korea, two tech-heavy indices, posted 1.6% and 1.5% gains on Monday as investors took a fresh look at risk-return profiles following a steep correction. In China, the authorities eased COVD-19 restrictions on major retail segments in major cities. As a result, indices in China (Shanghai Composite: 0.9%) ) and Hong Kong (HangSeng: 2.4%) rose. The latest development, coupled with positive statements from the official on tech stocks and new fiscal incentives to encourage economic activity drove the equities up. Indices in Japan (Topix: 1.1%) and India (SENSEX: 0.8%) also posted daily gains.