Saudi stocks slip on weaker oil prices

Saudi Arabia’s benchmark index eased 0.1 per cent, hit by a 1.2 per cent fall in Riyad Bank and a 0.7 per cent slip in Saudi British Bank

By Reuters

Published: Sun 14 Aug 2022, 5:42 PM

Last updated: Sun 14 Aug 2022, 5:43 PM

Saudi Arabia’s stock market ended slightly lower on Sunday in response to Friday’s fall in oil prices, while the Qatari index inched higher to notch up a third consecutive session of gains.

Oil prices, a key catalyst for the Gulf’s financial markets, had dropped around two per cent on expectations that supply disruptions in the US Gulf of Mexico would be short-term, while recession fears clouded the demand outlook.

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Saudi Arabia’s benchmark index eased 0.1 per cent, hit by a 1.2 per cent fall in Riyad Bank and a 0.7 per cent slip in Saudi British Bank.

Saudi Aramco shares closed flat, despite the state oil giant reporting a steep rise in quarterly profit.

Aramco on Sunday recorded its highest quarterly profit since going public in 2019, boosted by higher oil prices and refining margins.

Crude prices have soared in 2022 to their highest since 2008, climbing above $139 a barrel in March after the United States and Europe imposed sanctions on Russia over its invasion of Ukraine.

Prices have since eased to below $100 a barrel as soaring inflation and higher interest rates raise fears of a recession that would erode demand.

Net profit increased 90 per cent to SR181.64 billion ($48 billion) for the quarter to June 30 from SR95.47 billion a year earlier and compared with a mean estimate from 15 analysts of $46.2 billion.

Aramco declared a second-quarter dividend of $18.8 billion, in line with its own target, to be paid in the third quarter.

In Qatar, the index gained 0.4 per cent, with Industries Qatar advancing 1.8 per cent.

The petrochemical maker rose for a fifth session in six after last week posting a sharp rise in first-half net profit.

Outside the Gulf, Egypt’s blue-chip index was flat, as declines in financial shares were offset by gains elsewhere.

Among the gainers, Telecom Egypt jumped 3.9 per cent.

On Thursday, the telecom operator reported second-quarter net profit of 2.42 billion Egyptian pounds ($127 million), up from 1.75 billion Egyptian pounds a year ago. — Reuters