TADAWUL

The Saudi market's resilience was buoyed by the dynamic primary market in Saudi Arabia, witnessing a series of initial public offerings (IPOs) throughout the year. There were seven new listings on the main market and 32 on the Nomu-parallel market, with ADES Holding securing its place as Saudi Arabia's largest IPO in the year. In September 2023, the Saudi Exchange introduced four new indices based on company size and IPO performance, providing a comprehensive view of market dynamics.

The sectoral performance illustrated widespread gains, with the REITS index being the only exception, experiencing a 7.7% decline. Particularly noteworthy were the software and services sector, posting a remarkable 91.1% increase, followed by capital goods and pharma, biotech and life science indices, recording full-year gains of 90.0% and 69.0%, respectively. All constituents within the index demonstrated substantial increases in their share prices throughout the year.

Major sectors like banking and energy also showed positive trends, with increases of 5.7% and 14.6%, respectively. Aramco dominated the annual trading activity chart with a traded value of SAR 78.1 billion.

In order to create a world-class stock market, the Saudi Exchange introduced three new enhancements through its subsidiaries, namely the Saudi Exchange, Securities Clearing Center Company (Muqassa), and Securities Depository Center Company (Edaa).

These include a more streamlined order flow mechanism empowering market participants with advanced tools for dynamic short-selling activities. The exchange also introduced fast buy-in trades settled on the same day (T+0), adding an extra layer of eciency to trading. The negoti ated deals framework now also provides investors with the flexibility to tailor settlement cycles (T+0 to T+5) based on their deal dynamics.

Muqassa’s clearing services includes equities, sukuk, bonds, and traded fund markets. New post-trade services include rectifying trade before settlement, average price trades or split price trades, and other enhancements and services.

Finally, Edaa introduced a new central securities depository system and post-trade services aligned with global standards.

“The introduction of these enhancements, which are the largest in the history of the Saudi capital market, will provide investors and market participants with a wide range of investment opportunities and enable access to new and diversified financial instruments to manage risk and benefit from market movements,” according to the exchange.

The upgrades will also enhance investor access, improve risk management tools, and enhance trade and post-trade services for entities operating in the Saudi capital market, such as institutions and banks, as part of wider efforts to reinforce the Saudi capital market’s position as an attractive global investment destination.