With Ramadan very close, Arab stock markets continued their losses this week compounded by growing worries over the US debt ceiling standoff, financial analysts said Friday. They said that the decline over the week before Ramadan “is caused by a combination of investors selling shares to raise money to cover high spending during the month and other investors realizing gains in anticipation of a fall in share prices during Ramadan.” They also anticipated a further fall over the first three weeks of Ramadan “probably the result of the same factors that cause the fall in the run-up to Ramadan in addition to investors paying less attention to the market, and therefore investing less, as the month progresses.” Saudi shares lost fresh ground this week as investors continued to be obsessed by the US budget-cutting woes. The Tadawul All Share Index (TASI) of the Arab world's largest stock exchange, shed 0.69 percent on weekly basis, closing at 6,445.17 points. “Apparently, the Saudi stock market has ignored the good results of Saudi firms in the second quarter and, instead, is watching what happens in the United States and Europe,” said Mohammad Emran, member of the Saudi Economic Society. “The ambiguity is expected to dominate the market next week as the community of Saudi investors will monitor what kind of political agreement the Republicans and Democrats are going to strike by Tuesday,” he added. Emran expected stocks to be negatively affected in the coming weeks by the traditional liquidity crunch and the absence of moving factors in Ramadan. However, Emran said that Saudi stocks stood to gain in the medium term, finding support from the Saudi economic fundamentals as the huge volume of public spending, high oil prices and good profits of listed firms. Kuwaiti shares also closed in the red this week, with the all-share index losing 0.68 percent on weekly basis, closing at 6,036 points. The benchmarks of the United Arab Emirates stock exchanges of Dubai and Abu Dhabi shed 1.13 per cent and 2.42 percent to close week respectively at 1,506 points and 2,628 points. Qatar's all-share index lost 0.19 per cent this week, closing at 8,377 points while Bahrain's benchmark closed 0.37 percent in the red, at 1,298 points. The all-share index of the Amman Stock Exchange (ASE) closed week marginally lower at 2,089 points. Egypt's AGX 30 index plunged for the seventh week in a row, losing 2.2. percent on weekly basis and closing at 5,022 points. The Egyptian stock exchange came under pressure from foreign selling and worries over protest actions.
