Saudi surges on budget, Saudi Electricity leaps

26 Dec, 2016

Saudi Arabia's stock market surged in early trade on Sunday in response to the release of the 2017 state budget, which includes an increase in government spending next year to support flagging economic growth.
The Saudi stock index added 1.1 percent to 7,167 points in the first 15 minutes, nearing technical resistance on this year's peak of 7,235 points, hit earlier this month.
Utility Saudi Electricity jumped 6.6 percent after the government said in the budget it would raise domestic fuel and electricity prices by unspecified margins later this year.
The petrochemical sector was generally strong after the government said it would not raise gas feedstock prices before 2019. A feedstock price hike in the 2016 budget squeezed some petrochemical producers' margins.
Construction firm Abdullah Abdul Mohsin al-Khodari and Sons gained 1.9 percent after the government pledged to raise infrastructure spending, said it had settled unpaid bills to the private sector and promised to settle future bills within 60 days of receiving them. The construction sector was plagued by delays in recovering money from the government this year.
Zain Saudi rose 1.2 percent after saying it was in talks to sell its mobile transmitter towers to a consortium of TASC SAL and ACWA Rival Mobily underperformed the market slightly, edging up 0.4 percent, after the United Arab Emirates' Etisalat , which owns 27.4 percent of Mobily, said its management agreement with Mobily had expired.
Elsewhere in the Gulf, markets moved little and trade was thin because of the absence of foreign investors during the Christmas holidays.
Dubai's index was almost flat and Abu Dhabi edged up 0.2 percent as Etisalat rose 1.1 percent. Qatar's index inched up 0.1 percent.

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