Foreigners sold a net 4.01 billion riyals ($1.07 billion) in Saudi stocks in the week ending Oct. 18, exchange data showed on Sunday - one of the biggest selloffs since the market opened to direct foreign buying in mid-2015. The selloff came during a week when investors were rattled by Saudi Arabia's deteriorating relations with foreign governments following the disappearance of journalist Jamal Khashoggi.
A breakdown of the exchange data showed foreigners sold 5 billion riyals worth of stocks and bought 991.3 million worth. "The market started to price in a fundamentally different relationship between Saudi Arabia and the US," said Jaap Meijer, head of equity research, at Arqaam Capital.
"We believe the US will keep Saudi Arabia as its close ally given (amongst other things) the importance of the kingdom in the Middle East region and being the producer of 10 percent of the world oil supply." The stock exchange data also showed Saudi individual investors such as retail investors and high net worth individuals sold a net 3.4 billion riyals worth of stocks during the week, however Saudi institutions bought a net 7.8 billion riyals worth of stocks. Investors from other Gulf countries were also net sellers.
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