Tadawul Review:

Tadawul All Share Index (TASI) closed red for the second consecutive day, losing 225 points (-1.7%) to close at 12,690 levels. From the start of the session, the stock market moved downwards to touch a low of 339 points before recovering. The banking sector (-3.0%) was once again the prime suspect for the downward pressure on TASI, contributing 142 points to the index decline. Energy (-2.9%) and Telecom (-1.4%) followed by contributing negative 31 and 8 points respectively. Al Rajhi Bank, Saudi Aramco, and SNB moved the index most and closed down by 4.0%, 3.1%, and 2.1% respectively. Saudi Enaya, Sadr Logistics, and United Co-operative were the top gainers for the day, all closing at their upper locks (+10%).  Trading volumes and value rose by 17% and 9% to 205mn shares and SAR10.0bn. The stock market has lost 459 points(-3.5) in the last two days taking the cumulative loss to 1,130 points (-8.2%) in the last seven days. The pressure on the market can continue in the coming days, therefore investors are likely to take position only in stocks with strong fundamentals. 

Market Wrap International:

Following solid economic statistics and statements from Federal Reserve members, global shares jumped on Tuesday, while benchmark rates rose, confirming predictions that the central bank will continue to tighten until inflation is significantly lower. On Tuesday, the S&P500 rose +2.0% on broad-based purchasing, with 90% of companies trading higher, with technology (+2.9%), financials (+2.70%), and consumer discretionary (+2.70%) contributing the most to gains. The only negative sector was consumer staples, which fell -11.4% after Walmart reported a -25% reduction in quarterly earnings and lowered its full-year projection due to increased fuel and labor expenses. The Nasdaq Composite rose +2.8%, while the Dow Jones gained +1.3%.

European stocks rose as well, buoyed by expectations of loosening Chinese restrictions and greater Q1 GDP than previously projected. The second estimate of Q1 GDP increased from +5.0% to +5.1% year over year, an increase of +0.3% over the quarter compared to the earlier estimate of +0.2%. With indices rising throughout the area, the Euro Stoxx 600 gained 1.2%, while the DAX gained 1.6%, the CAC gained 1.3%, and the FTSE100 gained 0.7%. Unemployment figures for March in UK fell to its lowest level in decades, falling to +3.7% for the three months compared to expectations of +3.8%.

Asian markets marched upwards amid hopes for a rollback in China’s lockdown as well as toning down of Beijing’s regulatory crackdowns. As a result, the Sh Composite rose by 0.65%. Hong Kong’s stock market, the HangSeng, outperformed by 3.3%. Similarly, Nikkei 225 and KOSPI closed up by 0.4% and 0.9% respectively. In India, SENSEX also gave a strong performance rising by 2.5% despite state insurance company Life Corporation of India falling on its trade debut.