Saudi stock market entered a phase of remarkable stability prior to seek of foreign financial institutions to invest in the local financial market; it comes at a time when the Saudi stock ended the week trading too slightly low, which means that the index entered the market in the stabilization phase.
The stability and narrow volatility in the financial markets is considered important indicators of anticipation, in order to see the effect of a particular command on market transactions, this comes at a time when the Saudi stock market approaching the transition to a new historical stage, represented in direct openness to foreign financial institutions, something which will happen soon in the middle of next month.
In light of these developments, replicates of the Saudi stock market can predict the market trading at levels of 20 replicates Currently, however, a high-ranking official in one of the financial arms of the Saudi banks, confirmed to the «Middle East» yesterday, that some foreign financial institutions that intend to invest in the Saudi shares market, spotted about 11 trading companies, which is considered one of the most important currently available investment opportunities in the Saudi capital market.
And these assertions come at a time when the Saudi stock market index ended last week trading on a slight decline by 0.1 per cent, which is equivalent to only 11 points, closing at 9757 points, compared to last week closing at 9768 points.
According to the closure of the last week, the Saudi stock market index has recorded during the month of May a decline rate stands at 0.8 per cent, with loss of 77 points, compared to the close of trading of last April, while 9 sectors in the market trading week finished with losses, led by «the petrochemical sector» by 2 per cent, followed by the «Banks and financial services», and «hotels and tourism» by 1 per cent. According the same regard, shares of 81 companies ended lower, while shares of other 80 companies ended up, and shares of 4 companies settled at the same level as last week. Also trading value this week has seen a decline, with a total value amounted to about 37.34 billion riyals (9.9 billion $), compared with 42.78 billion riyals (11.4 billion dollars) during the preceded week.
In a related context, Faisal Alequab, financial and technical expert confirmed to the «Middle East» yesterday, that the continuation of the Saudi stock market index in trading between 9700 and 9800 point level, amid remarkable decline in cash flow, is an important indicator of the anticipation, and said: «Traders await the middle of the next month, the date of the entry of foreign financial institutions for direct investment in the Saudi stock market. »
He pointed out that the Saudi stock market index is currently moving in accidental in technical analysis point of view, noting that the period of s this track may prolong, but going out of it in any way require new cash flow target purchasing and Sales Operations, which did not happen in the Saudi market trading so far.
These developments come at a time when Saudi Capital Market Authority expressed great optimism by-step of opening the local stock market in the country to foreign financial institutions for direct investment, stressing at the same time that; foreign specialist investors will contribute to the reduction of high volatility in prices.
In this context, Mohammed Jadaan, chairman of Saudi Financial Market Authority board confirmed Finally that there are several targets that Kingdom aimed to achieve them by allowing foreign financial institutions eligible to invest in listed stocks in the Saudi financial market, , the most important of them is attracting specialist investors to promote institutional investment and raising the research and studies level about Saudi financial market.
Chairman of the Saudi Capital Market Authority also stressed that the rules that prepared by the body took into account its compliance with the relevant systems in the Kingdom, as well as it took the views of specialists in mind who participated with their proposals in a period of 90 days in which the Commission published rules draft on its website.