Better-than-expected mid-year profits by industrial giant Sabic recently shot Saudi shares past the 3,700-point psychological barrier to a new all-time high, analysts said.

Tadawul All-Shares Index (TASI) gained 3.2 per cent to close one day at 3,702.45 points, compared to the previous record of 3,673.10 points set on July 12.

The TASI was reported as 47 per cent higher than at the start of 2003.
Earlier that day, Sabic announced a 224 per cent surge in its net profits for the first six months of 2003 on the back of increased sales and a rise in prices.

The petrochemicals giant reported net income of 850.7 million dollars up to June 30 this year, eclipsing the 262.7 million dollars of the corresponding period of 2002.

Its net profits in the second quarter of 2003 reached 478.4 million dollars, up 29 per cent on 372.3 million made in the first quarter of the year.

'Sabic's better-than-expected results have certainly provided the spark needed by the already vigorous market,' said Snehdeep Fulzele, financial consultant at the Consulting Center for Finance and Investment (CCFI).

'The market is already rock solid with abundant cashflow, high oil prices and encouraging mid-year profits by most firms, especially market leaders Saudi Telecom and Saudi Electricity Co (SEC),' Fulzele told AFP.

In one day alone, Sabic surged 10 per cent, the maximum allowed on a single day.
Saudi Telecom rose 2.3 per cent and SEC increased 5.7 per cent.
Since the start of the year, Sabic has gained 54 per cent, Saudi Telecom 124.7 per cent and SEC 88.6 per cent.

Together with the nine listed commercial banks, the three companies make up more than 80 per cent of the market's value.

Saudi stocks ended the first six months of 2003 up 43.5 percent on the back of high liquidity, strong oil prices, better-than-expected public revenues and rising investor confidence.

Saudi Arabia has the largest capitalization of any Arab stock market with more than 130 billion dollars, but so far it operates only on an interbank basis.