Riyadh – Mubasher: Al Jazira Capital has released its forecast report on the financial performance of 37 companies in multiple sectors for the third quarter of 2019.
The combined result of these companies is projected to showcase a 25.5% year-on-year (YoY) drop in the earnings, impacted by a 56% YoY decline in the petrochemical sector, according to a recent press release.
Shariah banking sector in Saudi Arabia is predicted to show a 2.5% YoY increase, thanks to the improving lending activity.
In addition, the cement sector is expected to register a 571% YoY steep increase, owing to the improvement in cement selling prices as well as volumetric sales.
Al Jazira Capital further predicts the telecom sector to show a YoY increase of 15.3% in Q3 results due to the strong performance from STC. The research company also expects a ‘’profitable quarter’’ for Mobily.
The Saudi Stock Exchange (Tadawul) decreased by 8.4% during the period because of weak earnings and geopolitical risks. Foreign inflows soared to SAR 8.6 billion, posting an 8.44% higher foreign ownership from 7.45% by the end of June.
TASI’s low performance during Q3-19 is mainly attributed to the geopolitical risks, the US-China trade war, as well as oil prices volatility. The risk was aggravated after the terrorist attacks on Saudi Aramco’s oil facilities, with the global data raising concerns over oil demand.
“Money Supply continued the momentum with 5.0%Y/Y growth in August-19, highest since Sep-15. Marginal increase in GDP growth was supported by rise in crucial macro factors such as Purchasing Managers’ Index (PMI) which rose to 57.3 in September from 57.0 in August,” according to Al Jazira Capital.
