Stock market drops sharply by 2.7% in early trade with all sectors turning negative
Saudi Arabia's stock market dropped sharply in early trade on Wednesday after oil prices plunged again, while Egypt's bourse was also weak, tracking global emerging markets.
The main Saudi equity index fell 2.7 percent and all sectors were negative. Al Rajhi Bank, down 4.2 percent, was the main drag and another large lender, National Commercial Bank fell 1.9 percent.
Rating agency Fitch on Monday revised its outlook on both banks' ratings to negative from stable, following a similar revision for the sovereign's outlook last month, which was due to low oil prices.
Petrochemicals firm Saudi Basic Industries, whose profits are suffering from oil's drop, tumbled 3.5 percent.
Mecca real estate developer Jabal Omar dropped 4.5 percent after announcing on Monday it had cancelled a 1.6 billion riyal ($427 million) contract with a construction firm because both sides needed to review it.
Egypt's main index fell 1.2 percent and bourse data showed local institutions were heavy net sellers. Most stocks in Cairo fell, led by developer Heliopolis Housing, which dropped 3.4 percent.
The Cairo bourse had jumped earlier this week on news that Italy's Eni had discovered a potentially huge natural gas field just off Egypt's coast, but the rally was short-lived and the market has resumed moving in line with the broader Middle East sentiment.