RIYADH: The Saudi stock market was among the Arab region’s top performers in December, with the Tadawul index rising 3.39 percent amid improved liquidity and investor confidence, a new report showed.
At the end of the final month of 2024, TASI closed at 12,037 points, with an average daily trading value of SR5.2 billion ($1.3 billion), bringing the total monthly trading value to SR119.6 billion, according to the Arab Monetary Fund.
Dubai Financial Market led the regional surge with its DFMGI index rising by 6.42 percent, making it the best-performing exchange during the month. It was followed by the Palestinian and Iraqi stock exchanges, which registered gains of 4.85 percent and 4.14 percent, respectively.
This helped the AMF’s composite index for Arab financial markets post a 1.03 percent increase in December, as most regional stock markets ended the year on a positive note. The market rally was fueled by improved investor sentiment, easing inflationary pressures, and monetary policy adjustments across several economies.
Arab markets largely followed the performance of emerging markets. The MSCI Arab Index, which tracks the performance of stock exchanges in the region, increased by 3.46 percent.
In contrast, global markets showed mixed results. The Nikkei 225 rose by 4.41 percent, while indices such as the FTSE 100 and Dow Jones recorded declines of 1.38 percent and 5.27 percent, respectively.
Other key regional markets that saw growth included the Abu Dhabi, Kuwait, and Qatar stock exchanges.
Meanwhile, some markets saw declines, with the Damascus Securities Exchange registering the sharpest drop of 7.64 percent, followed by the Bahrain Bourse at 2.27 percent and the Egyptian Exchange at 1.66 percent.
In terms of market capitalization, Arab exchanges witnessed a 2.96 percent increase by the end of December, bringing the total market value to approximately $4.4 trillion. Tadawul played a major role in this growth, contributing 1.47 percentage points to the overall market capitalization increase.
The Beirut Stock Exchange recorded the largest percentage gain at 22.37 percent in market capitalization, followed by Dubai Financial Market at 13.54 percent and the Palestine Stock Exchange at 5.35 percent.
On the other hand, the Damascus Securities Exchange suffered the most significant decline at 7.40 percent, with the Bahrain and Casablanca exchanges also experiencing contractions.
Trading activity in the Arab financial markets also saw a sharp increase, with the total value of traded stocks rising by 25 percent compared to November levels.
The Egyptian Exchange led in trading volume growth, with an increase of 116.74 percent, while the Casablanca and Tunis stock exchanges recorded gains of 199.83 percent and 330.59 percent, respectively.
However, not all markets shared this momentum, as some, including the Damascus and Abu Dhabi stock exchanges, recorded declines in traded volumes.
Monetary policy adjustments played a crucial role in market performance. Several central banks in Arab and global markets eased their monetary policies in December, further supporting market liquidity.
The US Federal Reserve’s decision to cut interest rates led to similar actions in Saudi Arabia, the UAE, Qatar, and Bahrain, among others. The Turkish and Argentine central banks also made significant rate cuts to address domestic economic conditions.
The overall monetary easing environment contributed to strengthening investor sentiment and boosting equity market performance, the report said.
