How did TASI perform during 1H 2026?

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WHAT WE’RE TRACKING TODAY

MSGA starts trading tomorrow

Good morning, everyone. Our big story today dives into the domestic market’s performance during the first half of the year — TASI ended the six-month period up 3%, but value traded and the number of trades both fell over 10%.

Happening tomorrow

MSGA starts trading on Nomu tomorrow: The real estate developer’s shares will list with daily price fluctuation limits of 30% and static limits of 10%, according to a Tadawul disclosure. MSGA wrapped up its bookbuilding last month, offering a 10% stake to qualified investors at SAR 6 per share, targeting SAR 66.7 mn in proceeds and implying a post-listing market cap of SAR 667 mn.

Saudi anchor, foreign wallets

A new Saudi private equity fund built to pull foreign money into the kingdom is targeting a first close in 3Q 2026, an Alvarez & Marsal (A&M) spokesperson tells EnterpriseAM. Institutional investors are running due diligence on the fund and its agreement pipeline now, the spokesperson said. A&M, which helped structure the vehicle, has already put its own capital in and may increase its commitment.

The pitch is co-investment, not just capital. AGBI first reported that the fund will take controlling stakes in defensive, asset-backed sectors, including cold storage, warehousing, data centers, and healthcare. The fund will package “pre-wrapped” agreements so foreign investors can come in alongside a blue-chip Saudi partner rather than source and structure transactions themselves. A&M MENA regional leader Colie Spink told AGBI he expects the fund to drive equity deployment worth “a multiple” of its own size.

Why it matters: This is a live test of whether Saudi can swap private and foreign capital for state money. PIF has been pulling back, and FDI is still running below Vision 2030 targets. A vehicle that turns one Saudi anchor into several foreign co-investors could be the mechanism the kingdom’s FDI push has been missing.

AGBI quotes Spink on a USD 500 mn target. A&M declined to confirm the size, with the spokesperson telling us the company “has not formally announced a specific target size.”

Madinah is getting a Ferris wheel

The Kingdom is looking for private investors to build a SAR 511 mn (USD 135 mn) Ferris wheel in Madinah — listed on Invest Saudi as the Hijaz Eye — with a projected payback period of seven years, AGBI reports. The project would sit on a 33.7k sqm plot and is pitched as a pilgrim-facing attraction.

The logic: The Kingdom’s Umrah-plus strategy wants to encourage pilgrims to spend more time and money beyond the holy sites. Pilgrimage demand is less sensitive to economic conditions than typical leisure travel, CAPA’s head of analysis Richard Maslen has previously told us — and with 18.5 mn overseas religious visitors in 2025, the captive audience is substantial.

BUT- The region’s track record with large observation wheels is mixed. Ain Dubai has spent more time closed than open since its 2021 launch, and is currently shut.

SRC to issue USD-denominated sukuk

Saudi Real Estate Refinance Company (SRC) plans to issue Reg S senior unsecured USD-denominated sukuk, Zawya reports. The offering, issued under SRC Sukuk Limited’s Trust Certificate Issuance Program, will comprise 5.5-year and 10-year tranches. Meanwhile, fixed-income investor meetings are set to begin on 6 July.

REMEMBER- SRC previously finalized the pricing of its second government-guaranteed USD-denominated international sukuk offering. The issuance — valued at USD 2.5 bn — was more than 5.5x oversubscribed. The firm’s first government-guaranteed international sukuk was wrapped up in February 2025, valued at USD 2 bn.

ADVISORS- HSBC and JPMorgan are acting as joint global coordinators, joint lead managers, and bookrunners alongside DBS Bank, the Islamic Corporation for the Development of the Private Sector, KFH Capital, KIB Invest, Mizuho, Al Salam Bank, and Standard Chartered Bank.

Oil Watch

Aramco slashed Arab Light crude’s selling price for Asian buyers in August by the largest margin in 26 years, Bloomberg reports, citing a price list. The company cut the price by USD 11 per barrel to a USD 1.5 reduction to the regional benchmark, exceeding the USD 8 per barrel cut analysts expected.

One major Asian buyer is stepping up crude orders: China placed orders for at least 26 mn bbl for delivery in July or August from Saudi Arabia, the UAE, Qatar, and Iraq via tenders and one-off purchases from trading firms, the Financial Times reports, citing data from Argus. Beijing seeks to replenish domestic stocks — depleted during the regional war — that may have fallen to around 1 mn bbl / d in May and June. Beijing intentionally chose not to replace its missing Gulf oil with alternatives from elsewhere, forestalling fears of surging global prices.

The return of Beijing to Middle Eastern crude markets is a bullish signal, S&P director of oil trading research Zhuwei Wang told the FT. That said, a major rebound in Chinese crude oil purchases depends on Beijing lifting informal export restrictions on refined products like gasoline and jet fuel, Argus’ head of Asia crude pricing Fabian Ng says. These controls — put in place to protect domestic supply during the Iran war — cap the amount of raw crude China can currently import.

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The big story abroad

It’s an oddly quiet Tuesday morning on the foreign front pages, with no single story dominating headlines. Among those getting top billing:

#1- Iran’s military reportedly fired at least two missiles on commercial vessels crossing the Strait of Hormuz in the early hours of the morning, two US officials told Axios. The US “is likely to retaliate with strikes against Iranian targets,” according to Axios.

#2- Vertex Pharma will acquire drugmaker Crinetics Pharma for a total equity value of approximately USD 10 bn, diversifying its access to treatments that could generate more than USD 5 bn in annual revenues. The move is the latest in a surge of pharma dealmaking, as big pharma gains confidence in navigating regulatory scrutiny while racing to offset looming patent expirations.

#3- Major banks aim to skirt limits on debit card fees: A coterie of US banks — including JPMorgan Chase, Bank of America, and Wells Fargo — are reportedly looking to bypass a federal law capping debit card fees by acquiring a network owned by the fintech player Fiserv. While these caps cost the industry bns annually, banks have long argued the limits restrict them from offering customer rewards and other services. The acquisition is still in early stages.

#4- And in the gaming world: Microsoft is letting go of 4.8k employees as part of a major restructuring of its Xbox division, as the gaming industry faces an intense hardware crisis. The company is pivoting to navigate a paradigm shift ushered in by advancements in AI.

TASI holds through regional war, summer lull in 1H

The Saudi market ended the first half up 3% for the year, a result that looks unremarkable until you count what the six months contained. TASI weathered a regional war, a mid-April high it couldn’t hold, and a summer liquidity drought, and still closed 1H 2026 at 10,799.92, a 3% year-to-date increase. Measured against the same point a year earlier, the index is down 3.26%, per Tadawul’s 1H statistical report.

The path there was anything but straight. The index edged up around 8% in January, a rebound from the selling that closed out 2025, Argaam Investments Business Analysis Director Youssef Al Youssef tells EnterpriseAM, before profit-taking and the outbreak of the regional conflict set in. It recovered through March, peaked at 11,589.05 on 15 April, then gave most of the January gain back across a turbulent May and June, whipsawed by alternating talk of negotiations and renewed strikes. It held the 10,800 line into the close, a level Al Youssef says is firm support even after an early-July test of 11,000.

Look past the index, and the tape hides more than it shows. Market cap rose 3.40% y-o-y to SAR 9.44 tn (USD 2.52 tn). The gap is explained by a heavy run of bonus issues and capital increases — Al Rajhi, Riyad Bank and Alinma among them — plus fresh listings. Valuations barely budged — the market’s trailing P/E ended 1H at 16.0x, down from 16.4x in January.

Liquidity was the real casualty: Value traded fell 10.39% y-o-y to SAR 616.57 bn (USD 164.42 bn) and the number of trades dropped 11.79%. That points to cheaper, higher-turnover names carrying the tape. Americana alone accounted for 12.23% of all shares traded, while the value leaderboard stayed concentrated in Al Rajhi (SAR 47.5 bn) and Aramco (SAR 43.6 bn). The primary market cooled to match, with two IPOs in 1H against six in the same period last year. Al Youssef pins the late-June thinning on the summer exodus and the familiar “sell in May and go away” reflex among retail investors.

That the market held up at all, Al Youssef argues, is a point about the economy underneath it. Saudi was among the region’s better performers in the early weeks of the conflict, he says, on the flexibility of an economy able to keep oil moving by routing exports across the East-West pipeline rather than through a contested Gulf.

The resilience showed in the sector split: Ins. ran away with the half (+23.59% year-to-date) and energy held firm (+9.84%), while media and entertainment cratered (-35.90%) and healthcare (-11.89%) and transportation (-11.26%) lagged.

The post-April slide was a correction with clear leadership, Sico Capital Head of Research Chiro Ghosh tells EnterpriseAM. Banking, materials, healthcare, and the defensive capital-goods names drove it down. Banks underperformed as expectations for rate cuts faded, raising the specter of funding costs staying higher for longer. Materials came under pressure from the prospect of fresh supply as regional risk eased. The capital-goods names that had rallied on the conflict as a defensive play began handing gains back as de-escalation looked likelier, though the sector still sits, by his estimate, around 9% above its pre-conflict level. Healthcare was dented by worries over softer hospital visitation and medical inflation tied to possible disruption of regional trade routes, pressures he expects to normalize over the coming quarters.

Why it matters: The half’s flat-looking close sits on top of a structural rewiring. Effective 1 February, the CMA scrapped the Qualified Foreign Investor regime and the swap framework, opening the main market to all categories of foreign investors for direct purchase.

What’s next?

Both are constructive on 2H, by different roads. Ghosh expects rotation, with the leaders of the first half moderating while the laggards he named recover as cyclical and macro headwinds ease. His one hedge is energy, where a durable regional peace could soften oil-price expectations and weigh on the sector that helped hold the market up.

Al Youssef’s case is about flows and earnings. He is watching 2Q results closely, the first full quarter to capture the conflict where 1Q caught only March, and expects the results to drive real positioning. Beyond earnings, he sees a structural catalyst in the mechanism to raise foreign-ownership caps, which the CMA flagged late last year, and details are expected to land this half. That would pull passive, index-tracking money in behind it.

Construction costs to surge on oil market volatility -Currie & Brown

Construction costs aren’t coming down just because the strait is reopening. Data center projects in Saudi Arabia and the UAE could see cost increases of up to 9.9%, and hotel projects up to 9.5%, according to research (pdf) from cost management firm Currie & Brown — even after the US-Iran agreement.

The pressure is mounting on materials. Under a higher oil-price scenario, steel prices in the two markets could rise by up to 15.9% by September, copper by 5.4%, and aluminum by as much as 10.5%. “Saudi Arabia and the UAE have two of the most ambitious construction pipelines in the world. With demand for materials already strong, rising oil prices are adding further pressure to supply chains and construction costs,” Craig Finlayson, Currie & Brown’s Regional Commercial Director for the Middle East, said.

The most exposed sectors: Data centers are particularly exposed given their intensive use of copper and MEP systems — and in a sector where speed to market is critical, rising input costs force a reassessment of procurement strategies and project timelines. Meanwhile, hospitality projects depend on globally sourced fit-out materials and specialist equipment and face their own calculus in deciding where spending will best protect long-term asset value and operational performance as input costs rise. Both categories have limited ability to substitute locally.

The easing of immediate concerns following the US-Iran agreement buys time, but Currie & Brown’s view is that it doesn’t resolve the underlying uncertainty. Oil prices have yet to settle, supply chains remain stretched, and the construction pipeline across Saudi and the UAE — giga-projects, airport expansions, data centers — means demand for key materials is unlikely to soften meaningfully in the near term.

Microsoft taps Ayman Al Ghamdi as Microsoft Arabia’s president

Microsoft appoints Ayman Al Ghamdi (LinkedIn) as president of Microsoft Arabia, effective 5 July, according to a company statement. A 14-year Microsoft veteran, Al Ghamdi steps into the role from his previous position as VP of Public Sector in Saudi Arabia, where he worked with government entities on AI adoption and cloud deployment.

A busy schedule already: Al Ghamdi takes the helm as Microsoft prepares to launch its Saudi Arabia cloud region and has committed to training 3 mn people in AI skills by 2030.

Nesma gets Emaar’s KAEC contract + Riyadh Air, Flynas add new routes

Emaar hands Nesma a SAR 547 mn contract to build out KAEC’s automotive cluster. Emaar, the Economic City, awarded a SAR 547.4 mn contract to Nesma and Partners Contracting to build infrastructure networks within King Abdullah Economic City’s (KAEC) Industrial Valley, according to a Tadawul disclosure. The 18-month project covers phase one of the King Salman Automotive Cluster, other strategic projects within the Industrial Valley, alongside infrastructure for existing tenants. PIF, a major Emaar shareholder, owns 30.1% of Nesma.

REMEMBER- The contract comes after Emaar put its finances in order. The company completed its SAR 8.7 bn capital optimization plan by end-2025 — rescheduling banking facilities, securing a new shareholder loan, and reducing capital to offset accumulated losses — then raised capital through debt conversion and new share listings.

Riyadh Air, Flynas add new routes

Riyadh Air has opened ticket sales for daily Mumbai-Riyadh flights, its first Indian route, launching 4 August, according to a press release. The service operates on Boeing 787-9 Dreamliners and brings Riyadh Air’s total network to nine destinations, with more to be announced in the coming weeks.

Moving fast: The newly airborne carrier launched its first domestic flight linking Riyadh and Jeddah last month, days after its first commercial international flight to London Heathrow. Since then, it has added Dubai, Cairo, Kuala Lumpur, Malaga, Dhaka, Madrid and Manchester to its destinations.

PLUS- Low-cost carrier Flynas earlier this week launched a weekly direct service between Jeddah and Rabat, its first route to the Moroccan capital, it said in a press release. The launch adds to the carrier’s existing three-weekly Jeddah-Casablanca service, which started in 2023, expanding its Morocco footprint to two cities.

Asian loan market hits 16-year low in 1H

16 years — that’s how long it’s been since Asia’s loan market had a first half this bad. USD, EUR, and JPY loan issuance across Asia Pacific ex-Japan dropped 15% y-o-y to USD 69 bn in 1H 2026, the weakest first-half performance since 2010, according to Bloomberg data. The second half also looks no better.

The Iran war is the primary culprit. The conflict has stalled investment activity and pushed out financing timelines, with lenders applying more scrutiny to every transaction. “With increased uncertainty, there is a reduction in corporate confidence,” Andrew Ashman, head of Asia Pacific loan syndicate at Barclays, told the business information service. The M&A-driven issuance banks had expected hasn’t shown up, and the geopolitical drag looks set to last through year-end.

The Middle East liquidity channel is also narrowing. Middle Eastern banks are pulling back from offshore syndications and directing liquidity to their domestic markets — cutting off a funding source Asian borrowers have relied on for years. HSBC’s Ashish Sharma, head of leveraged and acquisition finance for Asia Pacific, expects the corridor to recover eventually — but not before conditions stabilize.

Some of that capital is landing in Australia. Loan volumes there fell around 10% in 1H, but an influx of Middle Eastern capital — redeployed as banks treat Australia as a safe haven — has intensified lender competition and compressed margins, Gavin Chappell, global head of acquisition finance and syndication at ANZ, told Bloomberg.

But it’s not just the war. China’s property slump is still weighing on credit demand, Indonesia’s regulatory tightening has cooled corporate appetite, and higher oil prices, paired with weaker currencies, have tightened conditions in markets like India.

Don’t expect the second half to look different. “The second-half volume may not be different from the first half purely because of macroeconomic reasons,” Birendra Baid, head of Asia Pacific loan syndication at Deutsche Bank, said. Still, with banks still willing to lend, pricing is expected to compress.

Where the money is going instead: With conventional volumes muted, capital is rotating toward higher-yielding pockets. Structured credit is picking up the slack, offering better returns than conventional corporate loans.

Data centers are the exception. Recent transactions include DayOne Data Centers Singapore doubling a MYR 15 bn facility, Blackstone-owned AirTrunk closing a USD 2.3 bn loan for a Malaysia project, while also seeking a USD 3 bn facility for a Sydney data center. Margins are rising too — a recent Malaysia transaction priced at 310 bps over SOFR, up from levels largely in the 200s over the past year, with bankers expecting another 20-50 bps of spread widening as further transactions come to market.

MARKETS THIS MORNING-

Asia-Pacific markets are down in early trading, with South Korea’s Kospi leading losses, down over 5%. Japan’s Nikkei is down almost 1%. Over on Wall Street, stocks are set to open flat with futures little changed.

TASI	10,813	+0.1% (YTD: +3.1%)
MSCI Tadawul 30	1,438	+0.1% (YTD: +3.6%)
NomuC	22,664	-0.1% (YTD: -2.7%)
USD : SAR (SAMA)	USD 3.75 Sell	USD 3.75 Buy
Interest rates	4.25% repo	3.75% reverse repo
EGX30	52,503	+2.7% (YTD: +25.5%)
ADX	9,922	+0.2% (YTD: -0.7%)
DFM	6,091	+0.5% (YTD: +0.7%)
S&P 500	7,537	+0.7% (YTD: +10.1%)
FTSE 100	10,652	-0.3% (YTD: +7.3%)
Euro Stoxx 50	6,398	-0.2% (YTD: +10.4%)
Brent crude	USD 72.23	+0.3%
Natural gas (Nymex)	USD 3.26	+0.3%
Gold	USD 4,158	-0.2%
BTC	USD 64,325	+1.0% (YTD: -26.6%)
Sukuk/bond market index	913.91	+0.1% (YTD: -0.6%)
S&P MENA Bond & Sukuk	152.23	+0.1% (YTD: +0.2%)
VIX (Volatility Index)	15.57	-1.5% (YTD: +4.2%)

THE CLOSING BELL: TADAWUL-

The TASI rose 0.1% yesterday on turnover of SAR 3.8 bn. The index is up 3.1% YTD.

In the green: Saudi Paper Manufacturing (+10.0%), Saudi Fisheries (+10.0%), and Ash-Sharqiyah Development (+6.9%).

In the red: Saudi Darb Investment (-5.7%), Batic Investments (-5.4%), and Al Moammar Information Systems (-4.8%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.1% yesterday on turnover of SAR 15.6 mn. The index is down 2.7% YTD.

In the green: Keir (+8.9%), ASG Plastic (+8.8%), and Marble Design (+8.1%).

In the red: Molan Steel (-12.3%), Digital Research (-7.0%), and MOBI Industry (-6.7%).

CALENDAR

AUGUST

30 August-1 September (Sunday-Tuesday): Saudi Paper and Packaging Expo, Riyadh International Convention & Exhibition Center.

31 August-3 September (Monday-Thursday): Leap Tech Conference, Riyadh Exhibition & Convention Center - Malham.

SEPTEMBER

8-10 September (Tuesday-Thursday): The WTM Spotlight Riyadh, Riyadh Front Exhibition & Conference Center (RFECC), Riyadh.

15-17 September (Tuesday-Thursday) The Global AI Summit, King Abdulaziz International Convention Center, Riyadh.

23 September (Wednesday): Saudi National Day.

28 September-1 October (Monday-Thursday): The International Conference on Theory and Practice of Electronic Governance (ICEGOV), Prince Sultan University, Riyadh.

OCTOBER

25-26 October (Sunday-Monday): The Global Proptech Summit, Mandarin Oriental Al Faisaliah Hotel, Riyadh.

26-28 October (Monday-Wednesday): ACHEMA Middle East, Riyadh International Convention & Exhibition Center.

28-29 October (Wednesday-Thursday): Procurement and Supply Chain Futures Forum, Mandarin Oriental Al Faisaliah Hotel, Riyadh.

28-29 October (Wednesday-Thursday): Real Estate Supply Chain Forum, Mandarin Oriental Al Faisaliah Hotel, Riyadh.

30 October-1 November (Friday-Sunday): The New Global Sport Conference, Sofitel Hotel & Convention Centre, Riyadh.

NOVEMBER

11-12 November (Wednesday-Thursday): Aluminum Arabia, The Arena, Riyadh.

16-19 November (Monday-Thursday): Cityscape Global, Riyadh Exhibition and Convention Centre (Malham), Riyadh.

29 November-1 December (Sunday-Tuesday): The UN Trade and Development Global Supply Chain Forum, Riyadh.

Signposted to happen sometime in 2026:

2H: Sabic’s USD 6.4 bn Fujian project in China to start production;
November: The Esports Nations Cup, Riyadh;
The World Economic Forum’s Global Collaboration and Growth Meeting, Jeddah;

2027

FEBRUARY

1-3 February (Monday-Wednesday): Energy Regulators Regional Association annual conference, Riyadh.

MARCH

21-25 March (Sunday-Thursday):The World Water Forum, Riyadh.

22–24 March (Monday-Wednesday): Capital Markets Forum, Four Seasons Hotel, Riyadh

APRIL

26-29 April (Monday-Thursday): World Energy Congress, Riyadh.

JUNE

1-3 June (Tuesday-Thursday): The Saudi Entertainment and Amusement Expo, Riyadh Front Exhibition and Conference Center.

Signposted to happen sometime in 2027:

The Ocean Race finishes in Amaala on the Red Sea;
Riyadh-Kudmi transmission line to be completed;
Aero Middle East and Sand & Fun takes place in Thumamah Airport, Riyadh.

Signposted to happen sometime in 2Q 2027:

The Hail Region Water Networks Project is expected to be completed.

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