Oct 21 Saudi Arabia’s stock market may face further selling pressure on Wednesday as a gloomy oil report and a sustained profit slump at the kingdom’s largest telecommunications operator sour sentiment.
Saudi Telecom Co, majority state-owned, reported a 31 percent drop in its third-quarter net profit late Tuesday, missing estimates as higher costs and expenses more than offset a growth in revenue.
This was its fourth profit decline in five quarters, while the former monopoly’s shares had ended at an 11-week high before the earnings were released which may indicate investors had bet on better results.
U.S. Light Crude was down 0.6 percent at $46.02 a barrel at 0532 GMT after data from an industry group showed a larger-than-expected build in U.S. crude inventories last week, fanning worries over global oversupply.
The sustained slump in oil prices has rattled investor confidence, with the consequent drop in state revenues expected to lower government spending.
Other Middle East markets were steady on Tuesday and with few other catalysts to draw in traders the bourses should remain calm.
Reuters
