31/05/2011
Petchems, banks weigh on Saudi index
Petrochemicals and banks weighed as Saudi Arabia's index TASI eased from Sunday's four-month high, while some traders targeted infrastructure and consumer stocks.
Saudi Basic Industries Corp (SABIC) dropped 0.5 percent and Al Rajhi Bank slipped 0.3 percent.
"Central bank data suggests deposit and loan growth by Saudi banks in the second-quarter, but first-quarter results were disappointing and the sector has been a laggard, so we're not playing it just yet," said Haissam Arabi, chief executive and fund manager at Gulfmena Alternative Investments.
Saudi Telecom Co and Saudi Electricity rose 0.6 and 1.5 percent respectively.
"In Saudi Arabia, we're particularly looking at materials - petrochemicals, fertilizer and chemicals - plus infrastructure plays, particularly the cement sector," said Arabi. "We're also making sure we have exposure to consumer discretionary stocks."
Cement and consumer sectors are benefitting from a state social spending programme, he added.
Worried by unrest sweeping the Arab world, Saudi has pledged to spend an estimated $130bn, or around 30 percent of its annual economic output, on new houses, creating jobs, unemployment benefits and other measures, while some state and private employers gave workers a bonus of two-months' salary.
The main index slipped 0.1 percent to 6,747 points.
The cement benchmark dropped 0.4 percent, declining for a second day since Saturday's 33-month peak.
