Saudi's building index reaches 7-month high
Tadawul's market sees results of project and budget boom in last month
The building and construction index on Saudi Arabia’s stock exchange reached its highest point in six months yesterday as the high volume of projects in the Kingdom is starting to be reflected in the sector’s listed companies.
The measure reached 3,404.86 at the close of trading in Riyadh having smashed the 3,000-mark on 7th December and coming close to the 3,412.27 reached on 13th July 2010.
Stocks have been buoyed by the many billions of riyals dedicated by the government to improving infrastructure and building new economic cities. Last month it released its largest budget ever at SAR 580 billion containing a number of economic, industrial and educational projects. Last year saw two compnies list on the market: Abdullah Al-Khodari - an Eastern Province-based contractor - and Al Jouf Cement Company, whose shares will be aggregated in the Tadawul's specific cement index.
Frost & Sullivan predicted that the company would invest US $53 billion in water projects over the next 15 years. About 70% of this investment is earmarked for sewage and wastewater treatment plants.
Mohammad Al Mojil, a civil contractor, has risen more than 30% since the start of December, and Zamil Industrial Investment Company – which contains Zamil Steel – has risen 10.5% over the same period.
Saudi Ceramics Company, which yesterday said it would begin a test run for a new clay pipe making facility in Riyadh in a joint venture with a subsidiary, has risen 9%.