Saudi Aramco closes below $2 trillion as stock declines for second day

Shares in Saudi Aramco dropped for a second day in a row a week after its record initial public offering, pushing its market value just below $2 trillion, the level sought by Crown Prince Mohammed bin Salman.

Shares ended 2.8 per cent lower at 36.70 riyals in Riyadh, giving the company a total value of $1.96 trillion.

The stock was included in the MSCI Emerging Markets Index and the main local benchmark, the Tadawul All Share Index, on Wednesday. A number of investors took this as an opportunity to sell a few of the shares bought in the IPO, said Marwan Haddad, senior portfolio manager at Emirates NBD Asset Management.

Aramco finished lower for the first time on Tuesday, ending the session down 0.7 per cent. However, investors are still sitting on a 15% gain from the IPO price.

Aramco has been “a very liquid stock, and flows from foreigners buying on the index inclusion are getting absorbed easily,” said Vrajesh Bhandari, senior portfolio manager at Al Mal Capital, in Dubai. “The price should stabilize somewhere at this level, or a tad lower.”