Saudi Arabia’s stock index posted its biggest single-day loss in two months on Monday as oil prices extended their slide.
The benchmark dropped two per cent to a two-week low of 9,438 points in a broad sell-off. The petrochemicals sector fell 2.6 per cent.
The earnings of petrochemicals producers, which constitute the biggest sector on Saudi Arabia’s stock market, have been hit hardest by oil’s sustained fall as their sales prices are often linked to petrochemicals prices.
Also, Saudi Arabia’s index had vastly outperformed other major Gulf markets, rising 15.5 per cent this year and so the uncertainty over oil tempted short-term investors to book profits.
Brent crude oil fell to around $54 a barrel on Monday, its lowest for more than a month, on rising global inventories and signs of a possible nuclear deal with Tehran that could allow more Iranian oil exports.