RIYADH: Saudi stocks are set to suffer their worst month since the pandemic, despite ranking seventh in the world this year, in dollar terms.
The Kingdom’s stock index is the seventh best performer in the world this year, as investors flocked to its shares as its economy got a boost from soaring oil prices and government reform.
Saudi stocks remain at a 60 percent premium over the MSCI Emerging Market Index, despite current market conditions, according to Bloomberg.
Yet, thay are expected to suffer their worst month as investors succumb to global risk-off sentiment amid recession fears.
The market is not immune to the global selloff, as the largest local investors have global holdings, according to Hasnain Malik, a strategist at Tellimer in Dubai.
“Valuation has reached a point where it is expensive versus history. That makes them vulnerable to any concerns on global oil demand,” he said.
The Tadawul All Share Index fell 8.3 percent in May, lagging the MSCI Emerging Markets gauge, and is on pace for its biggest monthly decline since March 2020, as investors sold banks after a global equity correction.
