Saudi bourse plunges as Gulf ministers meet

The renewed nosedive came as policymakers from Gulf states met in Riyadh to seek a common response to the global economic crisis.

The Tawadul All-Shares Index (TASI) was down 8.94 percent in early afternoon trade at 5,610.33 after dropping as low as 5,572 points, a level last seen in May 2004.

The fresh selling means the index has lost around 20 percent in the past eight days as the Riyadh market continues to reel from the global financial crisis.

The fall on one of the few markets open on a Saturday suggested no end is in sight for the rout which caused heavy losses on Friday on most stock exchanges worldwide.

Analysts say major initiatives are unlikely to result from the Gulf Cooperation Council (GCC) conference, as member countries have already made individually tailored moves.

All sectors of the Riyadh bourse were in the red. Petrochemical industries and banks each shed 9.7 percent and Saudi petrochemical heavyweight SABIC fell 9.5 percent.

SABIC's nine months results a week ago failed to provide a boost and the stock has shed half its value in 2008, a plunge almost matched by the TASI index.

Several listed companies registered losses of up to 10 percent -- the maximum threshold permissible under Saudi law.

The Riyadh summit is being attended by finance and economy ministers as well as central bankers from the six nations forming the GCC.

"The topic (of the financial crisis) will be high on the agenda. However, they have already acted," Monica Malik, an economist from investment bank EFG-Hermes, told AFP.

Policymakers are therefore likely to take an approach allowing them "to move as required," the economist said.

The Riyadh bourse is open between Saturday and Wednesday, while other stock exchanges in the oil-rich Gulf region operate from Sunday to Thursday.

The Saudi market ended last week down 10.2 percent with the TASI index finishing at 6,160.80 points.

On Wall Street on Friday, the Dow Jones Industrial Average eased 312.30 points (3.59 percent) to close at 8,378.95.

May other bourses moved even deeper into negative territory, with Tokyo plunging 9.6 percent and European markets diving around 5 percent.

Riyadh bourse is also strongly influenced by oil prices, which continued to fall in New York on Friday, finishing below 65 dollars a barrel despite a decision by the Organisation of Petroleum Exporting Countries to slash 1.5 million barrels from daily production.

On the New York Mercantile Exchange, benchmark light sweet crude for December delivery closed at 64.15 dollars a barrel, down 3.69 dollars from Thursday's close.