Overview:

The Tadawul Index declined 45 points to close at 10,808.43 points on Thursday, with 92 company shares recording gains while broader market momentum weakened. Oil prices maintained recent strength despite slower gains, gold prices retreated on inflation concerns, and the International Monetary Fund upgraded Saudi Arabia's 2027 growth forecast to 5.5 percent. Geopolitical developments in the Middle East continued to influence investor sentiment across equities and safe-haven assets.

Details:

The Saudi bourse closed in red territory as trading activity showed mixed performance. Ninety-two companies advanced while broader indices struggled with downward pressure. Market participants remained cautious following regional developments, including escalating tensions affecting maritime trade corridors.

Crude oil prices held gains from prior sessions, with Brent futures climbing approximately 78 cents to USD 78.80 per barrel following fresh military strikes. Energy analysts noted that supply chain risks and geopolitical events continued to underpin prices, though trading volumes reflected measured investor positioning rather than broad euphoria.

Gold prices declined for the second consecutive day, falling 0.4 percent to USD 4,060.46 per ounce as inflation concerns and dollar strength weighed on the precious metal. The International Monetary Fund significantly revised upward its economic growth projection for Saudi Arabia, now forecasting 5.5 percent expansion in 2027 compared to its April estimate of 4.5 percent—signaling confidence in the kingdom's diversification efforts.

Insurance premiums for maritime shipping through the Strait of Hormuz surged notably, reflecting heightened risk assessments following renewed naval confrontations. Meanwhile, business confidence indicators showed strength, with the General Authority for Statistics reporting the business confidence index at 56.6 points in June 2026, up one point from the previous month.

Outlook:

Investors will closely monitor the impact of Middle Eastern geopolitical developments on oil supply expectations and their transmission through energy-dependent equity valuations. The IMF's upgraded growth forecast may support sentiment for Saudi equities, though near-term trading is likely to remain sensitive to regional security developments and their effects on maritime commerce and crude prices.