Short Term Pain, Long Term Gain

We are more cautious the Saudi Arabia All-Share Index (SASI) as the bourse has fallen over 7% in the last three weeks suggesting that the index could be overbought in the short term. Key support currently exists at 10,400, a fall through which could suggest a move towards 9,300. That said, BMI still believes that the SASI, and Gulf stocks in general, offer investors a sound diversification play and we are bullish the index in the long-term. Indeed both technicals and fundamentals support our optimism as long-term support at 8,700 remains intact and we expect real GDP growth of 4.5%

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