2006 News Story

CMA announces reduced fees on stock trades; 5-day week for TASI

The Capital Market Authority (CMA) announced yesterday that it is reducing commissions on stock trades by 20 percent, effective June 17.  The minimum commission for trades of SR 10,000 [$2,666] or less will be SR 12 [$3.2].

The CMA also announced that the trading week of the Kingdom’s stock exchange, the Tadawul All-Share Index (TASI), would be reduced from 6 to five days beginning June 15.

Analysts welcomed the lower commissions as another positive step to boost investor confidence and increase the volume of trading, the Arab News reported today.

“The reduction in costs will encourage more investors to enter the market,” Faisal Al-Sayrafi, president and CEO of Financial Transaction House, said, as quoted in the Arab News. “All developed stock markets close on weekends, so this is normal.”

Said Al-Shaikh, a senior economist for the National Commercial Bank, told the Arab News that an increase in trade volume caused by the fee reduction should offset the loss in banks’ transaction revenues.