At the close of the Saudi stock market yesterday, shares had risen 3.1 percent for the week, buoyed by a surge in the newly-listed Sahara Petrochemical Company as well as strong oil prices and a move towards market reform, with turnover at SR35.9 billion ($9.8 billion). The all-share index climbed for a third week to close at 5,921.27 points, up from 5,745.75 last week. The index, although down from a record 6,455 points in May, is still up by more than 33 percent this year after rising 76 percent in 2003.

Investors have reacted positively to the establishment of a supervisory board under the 2003 Capital Markets Law, seen as a major step towards long-awaited reforms. Sahara, which started trading Wednesday, surged 230 percent from its offer price to close the week at SR165. The company was recently established by Al-Zamil, one of the Kingdom's largest private trading groups, to set up an olefins complex and a polypropylene plant. Meanwhile, blue-chip Saudi Electricity Company, which dominated trading with 21.5 percent of the total turnover, gained 9.9 percent to SR135.50. Savola, a foodstuffs group, climbed 8.9 percent to SR489 after reporting a 27-percent gain in half-year net profits. Gainers outnumbered decliners in the week by 61 to 10. The market was also supported by stronger oil prices, which have been a boon to the Saudi economy, boosting investor liquidity as well as corporate earnings.

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