Abdulaziz Al-Saif, founder and partner in Seventy Investments, said that the Saudi market index rose by 9% from the beginning of the year 2023 until the closing of the Thursday preceding Eid Al-Adha, and the rise was mainly from small and medium-sized companies, while the banking sector achieved a decline of about 2%. Since the beginning of the year, petrochemicals have been up nearly 6%.
He added, in an interview with Al-Arabiya, that the performance of banks was expected to be positive, and it is indeed so, at least in the first half of this year. Low levels last April, which coincided with the month of Ramadan.
He pointed out that the data issued by the Saudi Central Bank “SAMA” regarding the banking sector is good, and is expected to continue with the continuation of interest rates at their current levels. Many have good opportunities, especially those that depend on corporate lending in the first place.
He mentioned that the market’s rises since the beginning of the year were in certain sectors in the first place, and they were significant increases and had their reasons, including the health sector, the insurance sector, the transportation sector, and others, and witnessed an improvement in profitability, and part of it related to the increase in the population, and Vision 2023, which in many aspects benefits some companies.
He added that with the weakness of oil in the first half of this year, however, US stocks performed well, and the “S&P 500” index rose by about 16% since the beginning of the year, and last month it was only about 5% higher, and the data in America, whether for the growth of the economy or the improvement in consumption US citizens it is at its highest level in almost a year and a half.
He said that fears of global deflation began to diminish gradually, inflation began to decline, and the Saudi economy also grew by 3.8% at high levels and higher than global growth.
He pointed out that the reason for the drop in oil prices is the weakness of the data issued from China, especially on the manufacturing side, even growth in the United States of America and China is based on the services sector.
He added that manufacturing indicators in China are in the contraction zone, although they improved somewhat last month.
Al-Saif expected pressure on the petrochemical sector during the current year and continued pressure on the margins in the sector due to the great challenges facing it.
“The banking sector has good opportunities, and other sectors have fair assessments, but their performance will be good in the coming period,” according to Al-Saif.
He pointed out that a large percentage of daily trading is speculation, and this is evidenced by the rise in stocks that announce positive news in an exaggerated manner, and the focus on them has become greater than in the past.
“There is an exaggeration in the rises of some stocks, but in general the fundamentals of the companies are good,” he said.
