05/04/2015
Geopolitical factors have less impact on trading
corporate results cast a shadow on the stock market trading
The "economic" Analysts in the stock market Said "The results of trading sessions this week linked to key factors notably the corporate results for the first of the year of the quarter, which to be announced until the 20th of this month, and the latest developments in oil prices, and geopolitical factors in the region, but to a lesser degree".
They pointed out that the direction of the stock market at the moment technically low, in light of the anticipated decline in the results of the leading sectors, especially the petrochemical sector.
He said to the "economic" Faisal Al-Qahtani member of the Securities and Exchange Commission at Jeddah Chamber "The results of the next sessions of the stock market will be linked to the developments in the region, where a major strain on the market, in addition to the results of companies which in turn will appear this month."
He expected a reasonable corporate profit to support the rise of the market, and that today's session will be the end of the landing string experienced by the market and to resume the climb selectively in sectors where companies have performed well.
Al-Qahtani said that "the results of the companies that will be announced will play an influential role in the market."In light of the financial houses expertise expectations that the petrochemical sector profits goes down including SABIC, the index may face difficulty in the direction of ascent.
"The banking and retail sectors, insurance has been achieving good results as a result of demand from them", adding that "the eyes of investors, heading toward the insurance sector, it has liquidity, and most speculators are waiting for earnings results that expected to be good, so this sector will rise."
Nuclear deal between Western countries and Iran to partially lift sanctions on Tehran and thus increase oil supply in the market may lead; Al-Qahtani said that this factor may put pressure on oil prices and also may put a strain on the private sector in the petrochemical market.
He also said that the expected shift of liquidity from sectors which his companies facing difficulties to other sectors such as retail and insurance, where the last candidate this week to acquire more trading value.
Dr. Ahmed Alali member of the International Federation of Technical Analysts said "The market is in a downtrend technically and financially, while the petrochemical sector profits could fall by a large margin."
He added that the falling SABIC "shares has his impact on earnings in the sector, but may extend to the rest of the market segments."
He continued by saying, "Most of the young traders dependent on prices from 50 to 60%, thus the process of raising prices will now be suspended for decoding 90 per cent of traders and will result in a gain that small traders, senior trader pay the price, which is a logical process."
He said that young traders usually "following a market maker or investment funds, and it cannot be the opposite as in market makers follows young traders, it is not in their best interests to raise prices and decryption comment on small dealers."
"The weakness of transparency and manipulation by some accounting offices and some members of the boards of directors in their financial statements reduced the confidence of some companies beyond the heads of internal funds and investors entrants."
Mohammed Alshammemari analyst and financial adviser predicted that the financial results vary in the market between this sector and another.
"The forecasts indicate an increase in banking and cement profits, but for the petrochemical decline it is natural as a result in oil decline and because of periodic maintenance that always get in the first quarter."
For the telecommunications sector he said, "The STC is moving to make a profit, but in a limited fashion, while Mobily "If the performance achieved well, this may give the sector a positive push forward. Zain is not expected to achieve high profits, but it will reduce thelosses.
Saudi stocks fell last week for a third consecutive week, the longest string in a decline in the New Year, and closed at 8733 points.
The following declines on the stock market since the beginning of this month, where the negative path is the main case and several factors play a major role in the ongoing market declines, especially the low profitability of the petrochemical sector, which is one of the largest contributors to the profitability of the market.
The weekly market opened at 8903 points, then closed at 8733 points, 169 points, losing by 2 per cent.
The turnover fell 25 per cent to 37 billion riyals, while the value per transaction rate reached 50.7 thousand riyals, and traded shares fell 28 per cent to 1.4 billion shares traded.
The decline in the performance of 13 sectors compared with a rise of three, the first declining was "the multi-investment" by 3.18 per cent, followed by hotels and tourism sector increased by 2.89 percent in the third place was the petrochemical sector by 2.82 per cent.
