Key Takeaways

1. Saudi Cloud Computing Registrations Rose by 40%;
2. World Leaders to Meet in Riyadh for Mining Industry Discussion;
3. Saudi Arabia Plans a Benchmark-Sized Three-Tranche Bond Issuance;
4. Fed Board Member Bowman: Inflation Risks Remain, No Rate Cut Yet;
5. NVIDIA Debuts RTX 40 Super Series at CES, Touts AI PC Leadership;

I. Market Recap

The stock market in Saudi Arabia closed mixed on Monday. The Tadawul All Shares Index(TASI.SA) was down by 0.27%. Meanwhile, the Parallel Market Capped Index (NomuC)(NOMUC.SA) rose by 0.46%, whereas the MSCI Tadawul 30 Index lost 0.59%, closing at 1,589.80.

MBC Group Co.(4072.SA) emerged as the session's top performer, witnessing a 30.00% surge in its share price. In contrast, Maharah Human Resources Co.(1831.SA) faced headwinds, recording a 4.98% decline, ending as the day's most significant laggard in the main market.

TASI Gainers	TASI Losers

The three major US stock indices showed strong momentum throughout the day, with the NASDAQ(IXIC.US) rising by 2.20% and recovering most of this year’s losses. The S&P 500 index(SPX.US) increased by 1.41%, and both the Nasdaq and S&P 500 recorded their largest gains in nearly two months. The Dow Jones Industrial Average(DJI.US) also rose by 0.58%.

Oil prices remained at their largest drop in approximately a month due to indications of a softer physical market. This includes a significant price cut implemented by Saudi Arabia, the leader of OPEC+.

The Proshares Trust Ii Ultra Bloomberg Crude Oil(Post Rev Splt)(UCO.US) traded lower by 0.16% to $25.64 while United Sts Brent Oil Fd Lp Unit(BNO.US) was down by 3.07% to $27.19.

II. Flash Headlines

Saudi Cloud Computing Registrations Rose by 40%

Official data has revealed that Saudi Arabia experienced a significant increase in cloud computing registrations, with a 40 percent year-on-year growth in the fourth quarter of 2023. Cloud computing refers to the availability of system resources, such as data storage, without active management by the user. The Ministry of Commerce issued commercial registration certificates, which legally confirm a business’s official status in Saudi Arabia. The government bulletin highlighted the issuance of 1,759 cloud computing permits between October and December 2023, demonstrating the Kingdom’s commitment to becoming a technology hub by 2030.

World Leaders to Meet in Riyadh for Mining Industry Discussion

On January 9, the Saudi capital will host a roundtable meeting at the Future Minerals Forum 2024, bringing together ministers from more than 45 countries. This global gathering aims to address challenges in the mining and metals sector, particularly the growing demand for energy transition minerals. The high-level meeting will involve the participation of 80 countries, with over 45 ministers and representatives from international organizations, NGOs, and business associations. Collaborative efforts and technology development will be emphasized to ensure stable supply chains. The focus will be on promoting a green mineral supply chain, utilizing hydrogen and renewable energy sources for sustainability.

Saudi Arabia Plans a Benchmark-Sized Three-Tranche Bond Issuance

According to Reuters, Saudi Arabia is planning to access global debt markets by issuing a triple-tranche bond with tenors of six, 10, and 30 years. The bond sale is expected to take place on Monday. Initial guidance suggests that the benchmark-sized six-year bond will have an interest rate spread of around 115 basis points over US Treasuries, while the 10-year bond will have a spread of 135 bps over UST, and the 30-year bond will have a spread of 195 bps. Saudi Arabia, as the world’s leading oil exporter, recently approved a borrowing plan to address its fiscal deficit and meet upcoming payment obligations, estimating financing needs of $23 billion for 2024. This initiative aligns with the Kingdom’s Vision 2030 plan, aimed at diversifying its economy away from oil by promoting domestic growth and supporting non-oil GDP.

Fed Board Member Bowman: Inflation Risks Remain, No Rate Cut Yet

Federal Reserve board member Michelle Bowman has long been one of the staunchest supporters of monetary tightening policies. However, she indicated on Monday that she has slightly adjusted her stance and suggested that the rate hikes may be over. Nevertheless, Bowman stated that she is not yet prepared to start lowering interest rates. Speaking at an event, Bowman noted that the Fed has made progress in fighting inflation and advocated for short-term rates to remain at their current level.

III. Stocks To Watch

SA snapshot

Saudi's United Electronics Qtrly Profit Rises

United Electronics Co.(4003.SA) reported a quarterly net profit after zakat and tax of 126.17 million riyals, compared to 121.39 million riyals in the previous year. Quarterly sales amounted to 1,558.88 million riyals, showing growth from 1,545.96 million riyals in the same period last year. The company experienced an increase in revenues from the consumer financing services sector during the quarter. However, the retail sector faced a slight decline.

Saudi Paper Manufacturing Signs EUR 24.9M Facilities Agreement

Saudi Paper Manufacturing Co.(2300.SA)  has announced that it has obtained a facilities agreement for financing. The financing amount is EUR 24.9 million, and the duration of the financing is set at 5 years. The purpose of the financing is to support the purchase of new projects and to provide cash liquidity for covering the working capital required for operations. The financing entity involved in the agreement is Bank ABC (Arab Banking Corporation BSC).

Malath Insurance Chairman Mohammed Al-Ammari Resigns

Malath Cooperative Insurance Co.(8020.SA)  has announced the resignation of Mohammed Al-Ammari from his position as Chairman of the Board of Directors of Malath Insurance Company.

US snapshot

NVIDIA Unveils New Graphics Cards for Consumers at CES

NVIDIA Corporation(NVDA.US) announced the launch of three new consumer-oriented graphics cards during its speech at the Consumer Electronics Show (CES) on Monday. This will allow gamers, designers, and other computer users to better utilize AI on their PCs. NVIDIA claims that its graphics cards are the best engines driving new laptops and desktop computers. The RTX 40 Super series graphics cards are updated versions of existing products and will be available at a “great new price.” NVIDIA’s stock surged over 6% to reach an all-time high by the close of trading.

Apple Announces “Vision Pro” Launch on February 2nd

Apple Inc.(AAPL.US) announced on its official US website that its spatial computing device, “Vision Pro,” will be available for purchase in the US on February 2nd. The device will be released simultaneously in all official retail stores and the online Apple Store. The website indicates that pre-orders for Vision Pro will begin at 5:00 AM Pacific Standard Time on January 19th. The starting price for Vision Pro is $3,499, with a storage capacity of 256GB.

Axonics Soars Over 20% as Boston Scientific Acquires the Company

US medical technology company Axonics Modulation Technologies(AXNX.US) has announced a merger agreement with Boston Scientific Corporation(BSX.US). Boston Scientific will acquire Axonics in a cash transaction of $71 per share, with a total value of approximately $3.7 billion. The agreement is subject to approval from Axonics shareholders and regulatory authorities, and is expected to be completed in the first half of 2024. Following the completion of the transaction, Axonics will become a wholly-owned subsidiary of Boston Scientific. Axonics saw a significant increase of over 20% at the close of the market.

IV. Upcoming Events

Economic Calendar

Earnings Calendar

Note: All dates provided are estimates or based on company announcements, and are subject to change at any time, whether advanced or delayed.

[This newsletter is written and edited by Selena from Sahm News Team]