Saudi stocks soar on king’s spending spree
RIYADH – Saudi stocks rose sharply at the start of trading on Sunday, in the stock market’s first session since King Abdullah ordered unprecedented economic benefits worth around $100 billion.
Tadawul All-Shares Index (TASI) gained 5.6 percent just minutes after trading opened.
All 145 listed shares increased as well as the main 15 sectors led by the construction and cement industries, which added 5.3 percent each, following the king’s announcement on Friday.
It was the second spending package in less than a month to be announced by King Abdullah, who appeared to be responding to the sweeping unrest in the Arab world that since January has ousted long-time leaders in Egypt and Tunisia.
Banque Saudi Fransi estimated the new package to be worth around $93 billion, on top of the first deal announced in late February that was valued at around $36 billion.
Saudi Jadwa Investment said on Sunday that the two substantial spending packages would boost the economy and the Saudi bourse, where prices of shares have become attractive for buyers.
The Saudi monarch also ordered the spending of 250 billion riyals ($67 billion) to build 500,000 housing units.
The king ordered a minimum monthly wage of 3,000 riyals ($800) for civil servants, up from 2,185 riyals, and introduced a monthly unemployment benefit of 2,000 riyals for job-seekers.
The payments are to start after about eight months.
Unemployment in the world’s biggest crude exporter was 10.5 percent last year, but ran as high as 30 percent in the 20-29 age group, with an estimated 450,000 Saudi citizens out of work.