Tadawul Review:

Tadawul All Share Index (TASI) rose for the second consecutive day to add 88 points (+0.7%) closing above the psychological level of 12k (12,052) which was last seen in mid-June 2022. The market opened with a positive gap of 41 points and managed to touch a high of 133 points but soon profit taking kicked in trimming the gains. Today’s session was marred by low trading volumes which were recorded at 139mn shares, down 16% DoD while the value traded increased by 6% DoD to SAR5.4bn. Despite 13 of 20 sectors closing higher, the advance to decline ratio was less than 1. Banks (+0.6%), Energy (+2.4%), and Materials (+0.5%) sectors made sure that the index did not close in the red zone. Advanced Petrochem (+5.5%), Saudi Tadawul group (+4.2%), and Leejam (+3.9%) were the top gainers for the day. The market continues to consolidate at current levels given stable Brent oil prices and the ongoing earnings season.

 

 

 

Market Wrap International:

The global equity indices moved higher on Wednesday with earnings seasons and Fed Chairman’s comment post the latest decision on rate hike supporting the sentiment. In a much-awaited policy meeting, the FOMC decided to lift the Fed Fund Rate target rate by another 75bps to 2.25-2.5%. The Fed Chairman hinted at a slower pace of future rate hikes while abstaining from giving any guidance on the timing of pause or the size of future hikes. The comments have worked to ease investors’ concerns about the continuation of current pace and the increased expectation of the early peaking of rate cycle. This, coupled with consensus-beating earnings from tech companies lifted the S&P 500 (+2.8%), Nasdaq (++4.0%), and Down Jones (+1.4%) with most sectors or companies closing in the green.

In Europe earnings season dominated the proceedings and lifted the benchmark Stoxx Euro Index by 0.5%. Tech, leisure, and travel names were in the lead while healthcare and real estate sectors were the major drags. The European markets were closed before the Fed announcement.

In Asia, equity markets delivered a mixed performance with HangSeng (-1.1% on profit taking in tech. stocks ahead of result season) in Hong Kong dropping the most while India’s Sensex Index jumped the most (+1.0%, foreign flows & expiry of derivatives). Other major indices (Topix, KOSPI, and Shanghai Composite) closed with little change.