- Saudi Arabia's Tadawul All Share Index, the country's benchmark, has experienced a significant setback. On Thursday, the stock index declined by as much as 1%, extending its losses for the week and erasing all the gains achieved throughout the year. The Tadawul had previously surged by as much as 19% from its lows in March to July, narrowly missing out on entering a bull market.
- Oil prices rose yesterday, Thursday, after Saudi Arabia and Russia (leaders of the OPEC+ alliance) confirmed their close cooperation in the market. The decline in the MSCI Composite Index for the GCC countries during this week also extended the series of losses that it has been suffering since the beginning of this year, exceeding more than 6%, amid the state of uncertainty surrounding monetary policy expectations and geopolitical developments.
Why it matters
- The nation's banking sector, representing 36% of the Tadawul, is facing challenges due to elevated interest rates, which are limiting credit demand, and increased costs associated with debt refinancing. These factors are making it increasingly difficult for companies to meet their loan obligations. Furthermore, upcoming third-quarter earnings are anticipated to be mixed for certain sectors, reflecting weakening demand and rising costs.
