Reports

2022-12-12

Daily Market Monitor 12-12-2022

Tadawul Review:

Tadawul All-Share Index (TASI) closed down -108 points (-‎‎1.1%) on Sunday to close at 10,138 levels, which is the lowest closing level since April 25, 2021 (10,142). TASI opened the session positively and continued its rise in the first hours of trading as it reached its intraday high, achieving +80 points from the previous close. In the middle of the trading hours, TASI started to roll back to the end of the trading session, losing all of its gains. In general, 18 sectors out of 20 closed in the red zone, while 28 stocks rose and 179 fell. Materials (-‎‎2%), Banks (-0.6%), and Energy (-1.7%) sectors were the major drags on the index and contributed a total of -65 points. Stocks-wise, Aramco (-1.8%), Al Rajhi Bank (-0.9%), and Alinma Bank (-4.3%) pulled the index down the most. The trading activity also witnessed a decline in the volume and value of trading by 26% and 27%, respectively, to reach ‎‎84mn shares and SAR3bn. While volatility is likely to remain high 10k mark remains crucial for the index in near-term.

 

 

Market Wrap International:

All eyes will be on the U.S CPI data due on Tuesday, decisions by the central banks in the U.S, Europe and China, and the COVID-19 updates in China. All in all, markets are bracing for a more volatile week ahead given consensus view on key issues this week, positioning, and recent performance. In the U.S, the FOMC is set to decelerate the pace of interest rate from ‎‎75bps to 50bps in its two-day meeting set to conclude on Wednesday. The FOMC will also have the latest CPI data for the month of Nov-22 due to be released on Tuesday. For the market, the more important aspect of the FOMC meeting is post rate hike comments to gauge the peak and the timing of current interest rate cycle and any hint for reversal in interest rate in future.

In Europe, the ECB Governing Council meeting is due on Thursday to decide on the interest rate hike. Consensus expectations show 50bps hike in rate. For the regional investors, besides monetary policy decisions, the unfolding energy supply shortage in major economies in the peak winter season will also be a major issue to track.

In Asia, the recent market rally triggered by optimism on reopening of the Chinese economy is set to undergo a litmus test next week. The growing number of infection cases, especially in areas where lock-down restrictions have been eased, will test the resolve of Chinese authorities to stick to current policy ahead of new-year vacations. Central bank in China will be a lone outlier on interest with its likely status-quo decision next week. Other important data in the region relates to trade, industrial production in China and Japan.

Daily Market Monitor 12-12-2022