Saudi exchange triples daily trading limits for new listings

Saudi Arabia’s stock market tripled the daily trading limits for companies making their debut as it looks to absorb billions of dollars chasing new listings.

Starting November 8, newly listed stocks will be allowed to rise or fall 30 per cent on their first three days of trading, up from the current 10 per cent limit, the exchange known as Tadawul said in a statement.

The daily limits will revert to 10 per cent from the fourth day.

Tadawul’s Nomu-Parallel Market segment, which has lighter listing requirements, will expand daily price fluctuation limits to 30 per cent from 20 per cent for all listed securities.

Saudi Arabia has seen a flurry of new share offerings this year, in contrast to some of its neighbours.

Grocery chain BinDawood Holding Co. attracted almost $29bn in bids from investors for its $585m share sale this month, and the stock surged about 10 per cent in each of the first three days of trading.

Dr. Sulaiman Al Habib Medical Services Group, the biggest Saudi Arabian listing this year, saw orders for more than 80 times the shares on offer and the stock has almost doubled since the listing in March.

The IPO of the Saudi exchange, which has been in the work for years, will be assessed in the first quarter of next year, the Tadawul’s chief executive officer said in an interview last month.

The benchmark Tadawul All Share Index has pared most of its losses for the year, even as the world’s biggest oil exporter grapples with a tumbling crude prices.