Tadawul Review:

Tadawul All Share Index (TASI) pared early gains to close flat on Monday at 13,815 level. The market opened with a positive gap and touched its intraday high of 129 points during its first trading hour. Since then, TASI witnessed a steady decline with the closing auction recording a loss of 65 points. Overall, 8 of 20 sectors closed lower led by the Banking and Materials sector which contributed 22 and 15 points to the index decline. SNB, ANB, and Maaden were the major drags while STC and Saudi Fransi provided support to the index. Trading volumes increased by 56% to 224 mn shares and trading value surged upwards by 75% to SAR11.6 bn. Declining oil prices amid China lockdowns can put pressure on TASI in the near term.

 

Market Wrap International:

The negative sentiment in the global equity markets over the recent hike in the Fed Repo rate and concerns on global inflation persisted Monday. Meanwhile, the fallout from the Russian- Ukraine on broader commodity prices and latest economic data in China added to market concerns. In the U.S, the equity indices took up where they left off on Friday last week and plunged by -2.0-4.3% on Monday. The yield on 10-year U.S bond jumped by 14bps to close to the 3.2% mark while the dollar index also rose. Tech stocks once again received battering.

European stocks fell to their lowest level in two months as investors worried that tightening monetary policy in response to rising inflation might lead to a recession. By the end of trading, the Stoxx Europe 600 Index was down -2.9%, with travel and leisure stocks leading the way. In addition, for the first time in more than two years, a risk measure on Europe's safest corporations surpassed 100 basis points.

The Asian markets took a cue from the volatility in the U.S and European markets over the weekend and the weak economic data from China. The export and import data in China for the month of April showed significant slow-down in economic activity due to fresh COVID-19 related measures in the country though the data came in better than expected. Led by Jakarta Composite (-4.4%) in Indonesia, Nikkei (-2.5%) in Japan and KOSPI (-1.3%) in South Korea, markets in Asia failed to show any let up. Equity indices in China, however, performed better than benchmarks and peers with Shanghai Composite (+0.1%) buckling the broader trend.