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Saudi Arabia, Egypt stocks pull back as oil slides

Stock markets in Saudi Arabia and Egypt fell in early trade on Monday as both markets saw broad sell-offs against a weak global background

The main Saudi index fell 1.2 percent shortly after opening with most stocks in the red. Shares in heavyweight Saudi Basic Industries (SABIC) were also down 1.2 percent.

Brent crude fell more than $1 to near $78 a barrel on Monday following news that Japan, the world's fourth-biggest crude importer, had slipped into recession and after comments from the West's energy watchdog that a return to high oil prices was unlikely soon.

Although there is no strong correlation between oil prices and the performance of most Saudi stocks, cheaper crude may hurt the quarterly results of petrochemical firms such as SABIC by devaluing their inventories.

Global stock markets were also weak. The pan-European FTSEuronext 300 index slipped 0.3 percent by midday.

Egypt's market edged down 0.3 percent as investment bank EFG Hermes fell 2.0 percent and Commercial International Bank lost 0.2 percent.

Business Recorder
Published on:
November 17, 2014
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