DUBAI, Nov 20 (Reuters) - Selling of Saudi Arabian equities by foreign investors eased last week after increasing sharply early this month in response to the kingdom’s sweeping crackdown on corruption, exchange data released on Monday showed.
Immediately after the purge was announced, foreign investors were heavy net sellers of Saudi stocks. In the week to Nov. 9, they sold 2.00 billion riyals ($533 million) and bought 917 million riyals.
In the latest week to Nov. 16, they remained net sellers but by a much smaller margin, of 748 million riyals to 439 million riyals.
Many investors have been alarmed by the arrest of dozens of senior officials and businessmen, including major shareholders in several listed firms such as Kingdom Holding and Al Tayyar Travel. Over 2,000 bank accounts have been frozen in the investigation, threatening to slow the economy.
The exchange data showed Saudi individual investors remained net sellers of stocks in the latest week by a margin of 14.29 billion riyals to 11.89 billion riyals. Some individuals have been pulling money out of the market for fear it could be seized in the probe, according to local fund managers.
Saudi institutions - mostly mutual funds and corporations - were once again heavy net buyers in the latest week; they bought 4.04 billion riyals and sold 1.17 billion riyals.
Regional asset managers said they believed much of the Saudi institutional buying was by state-linked funds staging a deliberate support operation for the market in order to avert a panic. (Reporting by Andrew Torchia; Editing by Richard Balmforth)