Saudi Arabian index down as Maaden IPO opens

Saudi Arabia's main index ended lower, dragged by Saudi Basic Industries Corporation (Sabic), as state-owned mining firm Maaden floats a SR9.25 billion (Dh9.06bn) initial public offering (IPO).

Sabic shed 2.1 per cent and Samba Financial Group lost 2.55 per cent, pushing the benchmark index 0.94 per cent lower to 9,378.34 points, bringing its year-to-date performance to about minus 15 per cent, the worst in the Gulf.

"The IPO is absorbing some liquidity from the market but it will absorb more liquidity when it actually lists," says Abdulla Al Aqil, trader at Samba Financial. "The impact of the IPO will remain until the last day and the peaks will be on the first day and the last day."

The Saudi bourse, or Tadawul, said it has included shares of Mobile Telecommunications Company Saudi Arabia, or Zain Saudi Arabia, in the calculation of the market index. The mobile operator launched a 7 billion Saudi riyal ($1.87 billion) initial public offering last February and listed its shares on the Tadawul on March 22.

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