Saudi Shares Climb Most in Six Weeks After U.S. Jobs Data Beat Estimates
Saudi Arabian shares rose the most in seven weeks after U.S. and European markets rallied on reports reassuring investors that the recovery in the world’s biggest economy is not waning.
The Tadawul All Share Index gauge advanced 1.9 percent to 6,274.71 at the 3:30 p.m. close in Riyadh, the biggest gain since July 10. Saudi Basic Industries Corp., the world’s largest petrochemicals maker, known as Sabic, rallied the most since July 21.
“In the wake of a strong end of the week for western markets, especially U.S. data, the Saudi market confirms so far the will to test seven-week highs and positioning for a post- Ramadan spike as volumes increase a bit,” said John Sfakianakis, chief economist at Banque Saudi Fransi in Riyadh.
U.S., European and emerging-market stocks rose this week as better-than-estimated growth in U.S. private employment and manufacturing raised optimism the world’s biggest economy will avoid a recession.
The S&P 500 advanced 3.8 percent this week, the Dow Jones Industrial Average gained 2.9 percent, the Stoxx Europe 600 Index climbed 3.7 percent and the MSCI Emerging Markets Index rallied 3.5 percent.
U.S. payrolls that exclude government agencies climbed 67,000 in August, after a revised 107,000 increase in July that was more than initially estimated, Labor Department figures showed yesterday.
‘More Defined Uptick’
“Tadawul reacts to better-than-expected payroll numbers on Friday, pending home sales on Thursday and ISM data on Wednesday, resulting in a more defined uptick,” said Anas Kassem, an investment analyst at Ajeej Capital in Riyadh.
Sabic rose 2 percent to 87.75 riyals. Al Rajhi Bank, the kingdom’s biggest publicly traded lender by market value, gained 1 percent, to 78.25 riyals. Banque Saudi Fransi gained the most in three months, soaring 4.5 percent to 46.3 riyals. Savola Azizia United Co., a Saudi food producer, surged 4.6 percent, the most since October of last year, to 34.4 riyals.
Almost 107 million shares traded on the 25th day of Ramadan, the Islamic month when Muslims fast from sunrise to sunset and business slows. That compares with this year’s daily average of 141 million shares.
Saudi Arabia’s index is the only Gulf Arab benchmark tracked by Bloomberg that trades on a Saturday.
To contact the reporter on this story: Mourad Haroutunian in Riyadh at mharoutunian@bloomberg.net.
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