Tadawul poised for positive growth in 2024: Analyst

Financial analyst Hussein Al Attas

The Saudi Exchange (Tadawul) is experiencing a positive performance in 2024, propelled by the economic momentum fuelled by the Vision and mega projects, as well as the Kingdom’s robust economy, said financial analyst Hussein Al Attas.

This resilience persists despite global economic challenges, sustained interest rate stability, and geopolitical concerns, he told Argaam on the sidelines of the Saudi Capital Market Forum.

The positive performance of the Saudi financial sector during 2024 is expected to continue at the same pace as 2023, Al Attas said, adding that the growth rate will increase from 5% to 7%.

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Regarding the possible reduction in interest rates, he noted that the market today has absorbed the news of interest rates, and individuals and investors are increasingly aware of the potential outcomes associated with interest rate reduction, stabilization, or increase.

The analyst expected three interest rate cuts, starting from the third quarter of this year, each approximately at 1.1%.

This will reflect positively on companies with high borrowing rates, leading to a recovery in the retail sector, especially in the mortgage segment, Al Attas added.

Regarding the petrochemical and cement sectors, Al Attas said that these two sectors have been significantly affected by the economic recession, expecting their Q4 2023 results to extend into Q1 2024. 

He noted that the results are anticipated to improve during the third quarter with the decrease in interest rates.

Al Attas said that the petrochemical sector is going through an economic cycle that is nearing its end, adding that the cement sector is positioned to benefit from the ongoing building and construction activities in the Kingdom.