Bloomberg: Saudi shares are on their way to record the worst monthly performance in the world

Saudi shares are at risk of registering the worst performance of global markets during the month of May, with the fall in oil prices, which also increases the fear of delaying spending on huge projects in the kingdom. Since the beginning of May, the General Index ‘Tadawul’ has recorded a 6.4 % decline to Tuesday closing, which is the largest monthly decline between 92 indicators of financial markets following Bloomberg. This decline represents the fourth consecutive month after the decline in the index, which has been the longest monthly losses since 2014, while in contrast to the markets of emerging countries, it is the largest wave of profits in almost a year, with the best monthly achievement since September. Why did the Saudi stock market fall? Weakness in the Saudi Market is mainly due to the decline in oil prices, which dropped to its lowest levels in four years during April, in light of the blur of the global scene due to trade tensions and increasing supplies of the “OPEC+” alliance countries. This increased from the challenges of the Kingdom’s budget, which was recorded the largest deficit since the first quarter of the year. Junaid Ansari sees, from the company “Kamco Infost”, in Kuwait City, that “there is concern that the decline in oil revenue will affect the project market”, referring to the ambitious development plans that depend on the form of major government investments. Ansari added that this negative view is a candidate to continue, with the expectation that oil prices remain low in the coming period. Delit print on the “Trade” index indicates “Bloomberg” data indicates that the decline has affected most of the market sectors, as only 23 out of 253 shares were recorded in the “Tadawul” profit during May. Al -Rajhi Bank – The largest bank in the kingdom in terms of market value – was one of the biggest pressure shares on the index along with the “Aqua Power” business. A collective decline in Saudi shares amid the poor morale of investors. More details Brent Ru -amboule at about $ 65 a barrel, which is much lower than the levels that Saudi Arabia needs to cover its expenses. The first quarter data showed that the government needed a raw 96 -dollar price to reach the budget for its budget, and this price rises to $ 113 when the local spending plans for the public investment fund are included, according to Ziad Dawood, an analyst at Bloomberg Economics. Both of these numbers have been some of the highest levels since 2016, when the Kingdom introduced its vision for 2030. Challenges before major projects Dominic Bokour Ingram, director of a fund in Vieira capital, indicates that in his vision of the Saudi stock market, some of the ‘ambitious and ambitious projects’ can be postponed in the best way. It is useful that the level of the oil tie needed by the Saudi economy is higher than its peers in the region. However, Bokour Ingram builds its optimistic vision of the Saudi market in the long run, according to the expectation that ‘Vision 2030’ plans are still standing and will still attract investors. In light of the capabilities associated with the economic transformation in the kingdom, Ingram concluded: “The Prison of the Saudi Market could pose a great risk to investors interested in emerging markets.”