Saudi Stock Market Declines as East Pipes Integrated Shares Soar

Saudi Arabia's stock market fell 1.62% to a 3-month low, led by declines in Energy & Utilities, Insurance, and Media & Publishing sectors. East Pipes Integrated Company for Industry bucked the trend, rising 5.55% to an all-time high after securing a contract with Saudi Aramco.

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Aqsa Younas Rana
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Saudi Stock Market Declines as East Pipes Integrated Shares Soar

Saudi Stock Market Declines as East Pipes Integrated Shares Soar

The Saudi Arabia stock market experienced a significant decline on Sunday, with the Tadawul All Share index falling 1.62% to a new 3-month low. The losses were led by the Energy & Utilities, Insurance, and Media & Publishing sectors. Despite the overall market downturn, East Pipes Integrated Company for Industry (TADAWUL:1321) emerged as a standout performer, with its shares rising 5.55% to reach an all-time high of 171.20 points.

Why this matters: The performance of the Saudi Stock Exchange has significant implications for the region's economy, as it is one of the largest in the Arab world. The fluctuations in global commodity prices and the impact on individual companies like East Pipes Integrated Company for Industry can have far-reaching consequences for investors and the broader economy.

Other top performers on the Saudi Stock Exchange included Saudia Dairy and Foodstuff .Co (TADAWUL:2270), which rose 9.97% to trade at 386.20 points, and Al-Jouf Agriculture Development Co (TADAWUL:6070), which added 9.94% to end at 57.50 points. On the other hand, Thimar Development Holding Co (TADAWUL:4160), Tanmiah Food Company SCJSC (TADAWUL:2281), and Walaa Cooperative Insurance Company SJSC (TADAWUL:8060) were among the worst performers, falling 9.94%, 9.93%, and 9.91%, respectively.

The market decline comes amidst fluctuations in global commodity prices. Crude oil futures for June delivery were down 1.34% to $78.20 a barrel, while Brent oil for July delivery fell 1.31% to $82.78 a barrel. In contrast, gold futures contracts rose 1.14% to trade at $2,366.90 a troy ounce. The US Dollar Index Futures was up 0.07% at 105.18.

The strong performance of East Pipes Integrated Company for Industry can be attributed to the company's recent success in securing a contract with Saudi Aramco. The company, which specializes in producing helical submerged arc welded pipes with an annual production capacity of up to 500,000 tons, was awarded a contract worth SR1.8 billion to manufacture and supply steel pipes to Aramco. This development has boosted investor confidence in the company's prospects.

As of the end of April 2024, the market capitalization of Arab stock exchanges reached $4.361 trillion, according to the Arab Monetary Fund (AMF). The Saudi Stock Exchange remains one of the largest in the region, with a market value of $2.87 trillion. Other notable stock exchanges in the Arab world include the Abu Dhabi Securities Exchange ($754.7 billion), Dubai Financial Market ($193.4 billion), and Qatar Stock Exchange ($155.4 billion).

The Saudi Arabia Stock Exchange's decline on Sunday, with falling stocks outnumbering advancing ones by 176 to 108, reflects the market's sensitivity to global commodity price fluctuations and regional economic developments. However, the impressive performance of East Pipes Integrated Company for Industry, driven by its significant contract with Aramco, highlights the potential for individual companies to thrive even in challenging market conditions.

Key Takeaways

  • Saudi Arabia's Tadawul All Share index fell 1.62% to a 3-month low.
  • East Pipes Integrated Company for Industry's shares rose 5.55% to an all-time high.
  • Global commodity price fluctuations impacted the Saudi Stock Exchange.
  • Saudi Arabia's market capitalization is $2.87 trillion, largest in the Arab world.
  • Falling stocks outnumbered advancing ones by 176 to 108 on the Saudi exchange.