Saturday 23 June 2012

Saudi Shares Drop on Oil Price Decline, Fed Economic Forecast - Businessweek

Shares in Saudi Arabia, the only Gulf Arab stock market open on Saturdays, fell the most in more than a week as oil prices declined and after the U.S. Federal Reserve cut its economic forecast.

Saudi Basic Industries Corp. (SABIC), the world’s largest petrochemicals maker known as Sabic, dropped for the first time in four days. Saudi Kayan Petrochemical Co. (KAYAN) fell the most since June 12. Al-Rajhi Bank (RJHI), the biggest by market value, lost the most in a week. The Tadawul All Share Index (SASEIDX) retreated 0.9 percent 6,774.26 in Riyadh at the close.

Stocks “are clearly responding to downward pressure in oil,” Jarmo Kotilaine, chief economist at Jeddah-based National Commercial Bank, said in a phone interview. “The oil price is something that fuels the fiscal engine and the broader economic mood.”

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