Saudi stocks are among the most important topics for individual and institutional investors in the Kingdom of Saudi Arabia and the region. The Saudi financial market (Tadawul) is the largest stock exchange in the Gulf, hosting a wide range of listed companies from various economic sectors. In recent years, the Saudi stock market has witnessed significant developments in terms of regulatory laws, sector diversification, and increased participation from foreign investors. This coincided with the Kingdom's efforts to achieve the goals of Vision 2030, which focused on diversifying income sources and enhancing the financial market's position regionally and globally.
In this comprehensive guide, we will cover everything related to Saudi stocks: from how the market operates, the components of the TASI index, major sectors and listed companies, to the latest regulations, changes in foreign ownership, and the role of governance and disclosure in protecting investors. We will also highlight the financial data of the largest listed company (Saudi Aramco) and explain how investors can monitor the market and benefit from available information without providing any investment recommendations. The aim of this article is to provide a comprehensive educational picture that helps readers understand the dynamics and developments of the Saudi financial market in 2025.
Historical Overview of the Saudi Stock Market and Its Development
The Saudi stock market began in the early 1980s as an emerging exchange with a limited number of companies, mostly from the financial and industrial sectors. In 2007, the Saudi Stock Exchange Company (Tadawul) was established to become the sole regulatory entity responsible for managing the market. Since then, the market has experienced significant expansion in the number of listed companies, sector diversification, and increased liquidity.
One of the most important historical milestones was the listing of Saudi Aramco in 2019, which represented the largest initial public offering in history. The Saudi market also joined global emerging market indices such as FTSE Russell and MSCI, contributing to attracting massive foreign investments. With the updating of regulatory systems by the Capital Market Authority (CMA), the market has become more transparent and governed, increasing opportunities for institutional and foreign investment.
Market Structure and Types of Sub-Markets in Saudi Stocks
The Saudi stock market consists of several sub-markets, the most notable of which are:
1. Main Market: Includes stable large companies that meet strict criteria regarding capital, disclosure, and the number of shareholders.
2. Parallel Market (Nomu): Launched in 2017 to accommodate small and medium-sized enterprises with more flexible listing conditions, serving as a platform for rapid growth but carrying higher risks.
3. Sukuk and Bonds Market: Allows trading of government and corporate debt instruments, catering to investors seeking fixed income.
Trading mechanisms are standardized across these markets, but each has specific listing and disclosure requirements. All are supervised by the Capital Market Authority (CMA), which sets controls to protect investors and ensure the efficiency and transparency of transactions.
Tadawul All Share Index (TASI) and Its Role as a Market Benchmark
The Tadawul All Share Index (TASI) represents the main benchmark for the performance of Saudi stocks. TASI is calculated based on the market capitalization of free-floating shares listed in the main market and is capital-weighted, meaning that movements in large companies (such as Aramco or major banks) have a greater impact on it than smaller companies.
TASI has experienced significant fluctuations in recent years, declining to low levels in late 2023 due to falling oil prices, then rebounding strongly in 2024–2025 with the recovery of oil prices and the influx of foreign investments. Investors monitor TASI as an indicator of overall market direction and it often serves as a reference in analyzing the performance of investment portfolios and exchange-traded funds (ETFs).
Major Sectors in the Saudi Financial Market
Saudi stocks encompass a wide range of economic sectors, the most prominent of which are:
1. Energy Sector (Oil and Petrochemicals): Dominated by companies like Aramco and SABIC.
2. Financial and Banking Sector: Includes major banks (National, Al Rajhi, French).
3. Telecommunications and Information Technology Sector: Led by companies like STC and Mobily.
4. Industrial Sector: Includes cement and industrial products companies.
5. Consumer Goods and Retail Sector: Such as food markets and Al Othaim.
6. Real Estate and Construction Sector: Experiencing growth supported by government projects.
Capital distribution is heavily concentrated in the energy and banking sectors, while emerging sectors (such as renewable energy and technology) are experiencing rapid growth under Vision 2030.
Major Influential Companies in Saudi Stocks
Saudi stocks are characterized by the presence of giant companies that have a significant weight in the index and direct liquidity trends, including:
- Saudi Aramco (Symbol 2222): The largest publicly traded oil company globally, serving as a benchmark for market movement.
- SABIC (2010): The massive petrochemical arm of Aramco.
- National Commercial Bank (1180), Al Rajhi Bank (1120): Among the largest banks in terms of assets and trading volume.
- STC (7010): A leader in telecommunications.
- Saudi Electricity Company (5110): A key player in the energy sector.
Market indicators are often influenced by the movements of these companies, so investors continuously monitor them. The largest annual dividend distributions are concentrated in these entities.
Trading Mechanism and Working Hours in the Saudi Stock Market
Saudi stocks utilize a fully electronic trading system, allowing investors to execute buy and sell orders quickly and efficiently.
Official trading hours are from Sunday to Thursday, from 10:00 AM to 3:00 PM Riyadh time. The session includes:
- Opening auction period
- Continuous trading session
- Closing auction
Modern systems such as real-time trading (T+0) have been introduced, allowing for the execution of buy and sell operations within the same session. Flexibility in trading for individuals has also been enhanced through the expansion of licensed brokers and the facilitation of electronic account openings.
The Role of the Capital Market Authority (CMA) in Regulating Saudi Stocks
All transactions in Saudi stocks are subject to the supervision of the Capital Market Authority (CMA), which establishes rules and regulations to protect investors and ensure transparency and fairness in the market.
Among the key tasks of the authority are:
- Licensing brokers and listed companies
- Monitoring financial disclosure and transparency
- Enforcing governance and management standards for companies
- Developing legislative systems (such as regulating the futures market and stock splitting)
The authority also issues periodic reports on market performance and updates regarding regulatory rules, providing grievance channels and awareness services for investors.
Foreign Ownership in Saudi Stocks and Recent Updates
In recent years, Saudi stocks have seen trends toward increasing market openness to foreign investors, especially after joining MSCI and FTSE Russell indices. Currently, foreigners are allowed to own up to 49% of the shares of any listed company, with the possibility of raising this limit for certain companies according to the Capital Market Authority's directives.
In 2025, the authority is considering easing or raising the foreign ownership ceiling, positively reflecting on market performance and raising the TASI index to a record percentage. These steps aim to enhance liquidity and attract global institutional investments while maintaining transparency and disclosure standards to protect all parties.
Financial Data of the Largest Listed Company: Saudi Aramco
Saudi Aramco (Symbol 2222) is the largest listed company in Saudi stocks and the world, serving as a key indicator of market movement. At the end of 2024 and the beginning of 2025:
- Share Price: 36–38 SAR
- Market Capitalization: 3.6–3.8 trillion SAR
- Price-to-Earnings Ratio (P/E): Approximately 10
- Dividend Yield: 7% to 9% annually
- Revenue Growth 2024: A decrease of 12% compared to 2023 (annual profits of 106.25 billion USD, revenues of 436 billion USD)
- Latest quarterly results (Q4 2024): Quarterly earnings of 26–28 billion USD
These figures reflect the company's financial stability despite fluctuations in oil prices, with a strong commitment to dividend distribution policy and disclosure governance.
Impact of Oil Prices and Geopolitical Factors on Saudi Stocks
Saudi stocks are directly affected by global oil prices, given the national economy's reliance on oil and petrochemicals. Any sharp rise or fall in oil prices reflects on the results of companies, especially Aramco and SABIC, and affects the overall TASI index.
Geopolitical factors (such as wars or regional crises) can also lead to sharp market fluctuations, as investors react to rapid changes in the global economic environment. The Saudi government continues to support market stability through precautionary financial policies and economic diversification, which somewhat mitigates the severity of these fluctuations.
Public Offerings and New Listings in Saudi Stocks
Saudi stocks have witnessed notable activity in public offerings during 2024–2025, with the facilitation of initial offering procedures for medium and small companies. This has led to the listing of new companies in the technology, logistics, food, and renewable energy sectors.
Public offerings provide investors with the opportunity to enter companies at an early stage, but they carry higher risks due to a lack of historical data. The Capital Market Authority sets clear disclosure standards during the offering, requiring companies to publish a detailed prospectus and fair pricing of shares.
Strategies for Following Saudi Stocks News and Market Analysis
To effectively follow news about Saudi stocks, it is advisable to use official sources such as the Tadawul website (saudiexchange.sa), which provides real-time updates, company announcements, and periodic reports. Financial news agencies (Argaam, Reuters, Bloomberg) also offer comprehensive analyses of company and sector performance.
Investors should review quarterly and annual reports and monitor key financial indicators of the stock (P/E, dividend yield, revenue growth). It is also preferable to analyze the impact of local and global economic news on market movements, without relying on individual decisions or unreliable forecasts.
Corporate Governance and Disclosure in the Saudi Stock Market
The Capital Market Authority places utmost importance on governance and disclosure in Saudi stocks, imposing global standards on listed companies regarding board management, disclosure of interests, and monitoring operational processes.
In 2024, significant amendments to disclosure rules were issued, requiring companies to publish their financial results on specific dates and disclose any material events that may affect the stock. The authority also mandated companies to appoint internal audit committees and enhance shareholder participation in decision-making. These policies aim to enhance transparency and protect the rights of all investors.
Risks and Opportunities in the Saudi Stock Market
Despite the stability and growth of the Saudi stock market, there remain several risks that investors should be aware of, such as:
- Fluctuations in oil prices and energy markets
- Sudden regulatory or economic changes
- Liquidity risks in small stocks or the parallel market
- The impact of regional geopolitical events
Conversely, the market offers growth opportunities in emerging sectors (technology, renewable energy) and the potential to benefit from dividends of major companies. It is important to diversify investment portfolios and follow a balanced investment policy based on the investor's goals and risk tolerance.
Conclusion
In conclusion, Saudi stocks remain a central pillar of the national economy and a primary pathway for attracting local and foreign investments. With the evolution of regulatory systems, the expansion of the base of listed companies, and the increase in transparency and governance levels, the market's attractiveness to investors from various categories is rising. However, every investor should remember that the market carries both opportunities and risks, and investment decisions should be based on a deep understanding and accurate analysis of financial data and economic news. The SIGMIX platform offers educational and analytical content that helps you monitor developments in the Saudi financial market in a neutral and professional manner. We also always recommend consulting a licensed financial advisor before making any investment decision to ensure that choices align with your financial goals and protect your capital.
Frequently Asked Questions
To invest in Saudi stocks, you must first open an investment account with a financial broker licensed by the Capital Market Authority (CMA). After opening the account and verifying your data, you can deposit funds and start buying and selling stocks through the electronic trading platform. It is advisable to review regulatory guidelines, ensure you understand investment conditions, and avoid relying on borrowing or unverified recommendations. You should also monitor the periodic financial reports of companies before making any decisions.
The Main Market includes stable large companies that meet strict criteria regarding capital, disclosure, and the number of shareholders, characterized by lower volatility and higher liquidity. The Parallel Market (Nomu), on the other hand, is designated for small and medium-sized companies with flexible listing conditions, considered a platform for rapid growth but carries higher risks of volatility and performance. Both markets are supervised by the Capital Market Authority, but the nature of risks and returns differs between them.
The TASI index is the main index that measures the performance of all stocks listed in the Saudi main market. It is calculated based on the market capitalization of free-floating shares and is used as a general measure of market direction. Investors and index funds monitor TASI to analyze overall market performance or compare their investment portfolios' performance against the benchmark index.
Among the prominent listed companies are: Saudi Aramco (the largest oil company in the world), SABIC (petrochemicals), National Commercial Bank, Al Rajhi Bank, STC (telecommunications), and Saudi Electricity Company. These companies represent the majority of market capitalization and directly influence the index's movement and liquidity.
Currently, foreign investors can own up to 49% of the shares of any listed company in the Saudi stock market. The Capital Market Authority is considering options to raise this limit for certain companies as part of market reforms. It is essential to continuously review regulatory guidelines for the latest updates on this matter.
You can follow market news through the official Tadawul website (saudiexchange.sa), which provides real-time data and company announcements. Financial news agencies (Argaam, Reuters, Bloomberg) also provide comprehensive coverage. It is also advisable to monitor quarterly and annual reports of listed companies to obtain an accurate picture of stock performance.
Companies in the energy sector (like Aramco and SABIC) and major banks (National, Al Rajhi) typically offer relatively high dividend yields, ranging from 6% to 10% annually. The value of dividends depends on the company's performance and board decisions, so it is advisable to check the latest financial data and dividend announcements for each company.
Oil prices are a key factor in directing the performance of Saudi stocks, especially in sectors related to energy and petrochemicals. Any sharp decline or rise in oil prices reflects on the results of major companies and the overall index. Oil prices also affect liquidity and investor confidence in the market in general.
The Saudi stock market is subject to the regulations and rules of the Capital Market Authority (CMA), which include disclosure requirements, governance, investor protection, and market manipulation controls. The authority issues periodic updates to the laws and imposes fines or penalties for violations. It is advisable to check the authority's official website for the latest regulations.
Governance and disclosure play a fundamental role in enhancing transparency and protecting investors in the Saudi stock market. The Capital Market Authority imposes mandatory standards for disclosing financial results and material events and forming internal audit committees. These policies aim to build trust and stabilize the market in the long term.