Tadawul Review:

TASI continued its upward streak for the sixth consecutive day despite Brent prices falling below the USD100/bbl mark. On Monday, Tadawul All Share Index (TASI) gained 88 points (+0.7%) to close at 13,483 levels. The rally was led by the Banking sector which rose by 1.5% as several banks recorded gains between +1% and +4%. The Health Care sector was the top gainer, climbing +2.5%, mainly due to the rise in stock prices of EQUIPMENT HOUSE and CARE by +10% and +5%, respectively. The Energy sector closed in the red zone as SAUDI ARAMCO recorded a loss of -0.2% while the Materials sector also ended the session in the negative. Trading volumes and values ended the session on a positive note with gains of +20.6% and +19.1%, respectively. The market has added more than 400 points in the last six days which can result in some profit-taking at these levels. However, the sustainability of oil prices at current levels and the ongoing 1Q22 result season are likely to dictate the direction of the market in the short run.

 

Market Wrap International:

Globally, markets dipped on Monday, while bond yields rose, as Chinese inflation and producer prices exceeded expectations, while the persisting COVID-19 outbreak, despite restrictions, dragged on mood and fueled fears of increased inflation. In broad-based selling, the S&P500 fell -1.7%, with 76% of equities along with all of the sectors closing in red, with technology -2.6%, health care -2.0%, and consumer discretionary -1.9% weighing the most heavily. The Dow Jones Industrial Average fell -1.2%, while the Nasdaq Composite fell -2.2%. The yield curve steepened, with the 2-year yield falling while the 10- and 30-year rates rising respectively ahead of a significant week of economic data, which includes March U.S. inflation, producer prices, retail sales, consumer sentiment and the start of Q12022 earnings.

In Europe, indices were mostly lower in the first session of the week mainly affected by the COVID-19 lockdown in China as many factories were shut down. The broad-based European index Stoxx 600 fell on Monday by -0.6%. In Germany, as inflation concerns rise, DAX traded mostly negative to close -0.6%. In the UK, GDP data was disappointing which led FTSE 100 to end the session -0.7% in the red. However, the French benchmark (CAC 40) responded positively after the first round of presidential election and was slightly positive by +0.1%.

All the major stock markets in Asia closed in the red zone on Monday as investors seemed wary of upcoming central bank meetings and US inflation data. The losses in the region were led by the Chinese stocks, due to investors’ reaction to the country’s inflation data as of March alongside observation of the COVID situation. The SZSE Composite index and SHCOMP recorded losses of -3.7% and -2.6%, respectively. The Hang Seng index fell by -3.0%, recording a near four-week low, on concerns that the reinforcing of Shanghai lockdown will upset manufacturing and economic growth. In Japan, the Nikkei 225 index weakened by -0.6%. KOSPI and SENSEX also closed in the negative, decreasing by -0.3% and -0.8%, respectively.