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Saudi Shares Drop While Bonds Gain After Austerity Measures

  • The Tadawul index falls as much as 3.5%, bonds due 2060 rise
  • Assets are reacting to hike in VAT, cut to state allowances
Updated on

Saudi shares fell the most in the Gulf while sovereign bonds rose after the government tripled the value-added tax and cut allowances for state workers in austerity measures to cope with the economic impact of the coronavirus pandemic and the drop in oil prices.

The Tadawul All Share Index retreated as much as 3.5% in Riyadh, before trimming losses to 1.2% at the close. Al Rajhi Bank, National Commercial Bank and Saudi Aramco pressured the benchmark the most, sliding by between 0.8% and 2.4%.