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RIYADH: Saudi Arabia’s Tadawul All Share Index posted an annual gain of 1,811.46 points, or 17.11 percent, to reach 12,401.56 at the end of the first quarter of 2024, official data showed. 

According to the report released by Saudi Exchange, the highest close level of the main index in the first quarter was on March 21 when it peaked at 12,835.65.

Moreover, the total equity market capitalization of the main market by the end of the first quarter reached SR10.93 trillion ($2.91 trillion), representing a rise of 9.56 percent compared to the same period of the previous year. 

Similarly, the total value of shares traded during the first three months of 2024 soared by 113.52 percent year on year to reach SR575.89 billion. 

The total volume of shares traded reached 24.12 billion during the first quarter of this year, compared to 22.74 billion shares traded in the same period of 2023. 

Additionally, the number of transactions executed in the three months to the end of March reached 35.02 million compared to 20.12 million in the year-ago period. 

Major developments during the first quarter

Saudi Arabia’s main index witnessed three new listings in the first quarter of this year. 

Shares in Saudi Arabia’s media giant MBC Group Co. began trading on the main market on Jan. 8, followed by Middle East Pharmaceutical Industries Co. and Modern Mills for Food Products Co. on Feb. 27 and March 27, respectively.  

On Jan. 7, Saudi Exchange announced the launch of the TASI50 Index, which tracks the top 50 companies ranked by total market capitalization.

“Constituents in the index cover 90 percent of the free float market cap with a minimum annual traded value ratio of 5 percent, ensuring that the index is a comprehensive representation of the largest companies in the market,” said the exchange in the report. 

Moreover, the index can be used as a benchmark for exchange-traded funds, Futures, Options, and other financial products. 

As of March 27, the exchange has 216 securities listed on the Tadawul All Share Index, while the parallel market Nomu has 83. 

On the Saudi exchange, there are 71 sukuk and bonds, followed by 19 real estate investment trusts, 9 exchange-traded funds, and 2 closed-end funds. 

On March 31, Saudi Exchange announced that it welcomed its 400th listing across all securities, a development described by the company’s Chief of Listing Nasser Al-Ajaji as marking “a significant milestone” and “a clear testament to the Kingdom’s dynamic capital market and its growing appeal to investors globally.” 

He added: “These achievements are more than just a number; they are symbolic of the economic diversity and growth spurred by Saudi Arabia’s Vision 2030, the Financial Sector Development Program, and the support of the CMA to accelerate the IPO (initial public offering) pipeline. All of this reflects the potential we are poised to realize.” 

Remarkable growth of the parallel market 

Saudi Arabia’s parallel market Nomu also witnessed significant growth during the first quarter of this year. 

According to the report, it closed at 26,030.03 at the end of March, representing a rise of 30.86 percent compared to the same period of the previous year.  

On Mar. 21, Nomu reached 27,362.29, the highest closing level in the first three months of 2024. 

The total equity market capitalization of the parallel market also surged by 31.24 percent year on year in the first quarter to reach SR50.83 billion. 

Similarly, the total value of shares traded during the first quarter reached SR3.33 billion, a rise of 86.10 percent compared to the same period in 2023.

Additionally, the total number of volumes traded in the parallel market increased by 18.80 percent year on year to 185.92 million shares during the first quarter, the report added. 

Six IPOs on Nomu to kick off 2024

The parallel market witnessed six IPOs in the first quarter of the year.

Pan Gulf Marketing Co. was listed in Nomu on Feb. 18, followed by the listings of WSM for Information Technology Co. and Al-Modawat Specialized Medical Co. on Feb. 21 and Feb. 25, respectively. 

On March 3, Quara Finance Co. started trading on the parallel market, while Al Mohafaza Co. for Education was listed on March 26, followed by the listing of Taqat Mineral Trading Co. on March 28. 

Moreover, in the derivatives market, Saudi Exchange announced the launch of single stock options in the Saudi National Bank and Alinma Bank during the first quarter, which will be cleared by securities clearing center company Muqassa. 

Saudi main index to maintain growth momentum: Al Rajhi Capital

Another report released by financial services firm Al Rajhi Capital said that the Kingdom’s main market will continue its growth in the second quarter of this year. 

“Our new target for TASI by the end of June 2024 is 12,712 points. As of April 2, TASI is up about 4.2 percent year to date and has come off from its highs of 12,835 points hit on March 21. The key reason for the decline has been the sharp correction noticed in the small and mid-cap space,” said the report. 

According to Al Rajhi Capital’s fund managers survey, participants expect TASI to consolidate between 12,500-13,000, and are optimistic on Saudi Arabia’s medium-term prospects.

“Going forward, we believe first quarter earnings from the banks (will be relatively better) and no major negative surprise from the Fed should support the index. Further, some recovery in the small and mid-cap space on bottom fishing should also help the index,” said Al Rajhi Capital. 

According to the report, oil prices will continue to average above $80 per barrel over the coming years owing to the anticipated improvement in the oil market balance.

“Furthermore, the current refinery spreads shall aid in improving the demand outlook as the spreads are hovering above pre-Covid levels,” Al Rajhi Capital concluded.