April 11, 2006	Tuesday	Rabi-ul-Awwal 12, 1427

RIYADH, April 10: Saudi Arabia’s stock index tumbled 8 per cent on Monday, its steepest fall on record, after an attempt by market regulators to crack down on market manipulation triggered a frenzy of selling.

The decline was the sharpest by any Gulf Arab market since March 14 when bourses sank across the world’s biggest oil-exporting region. Analysts warned that the Saudi plunge could trigger sell-offs in other markets.

With a capitalization of over $600 billion the Saudi bourse is the Gulf’s biggest. It is also the most volatile, largely due to the role of huge speculative funds that have resisted the regulators’ attempts to stamp its authority on the market.

When the Capital Markets Authority suspended two dealers on Sunday on suspicion of market manipulation, brokers said speculators began selling, fearing a crackdown would threaten their dominance.

“They are on a kamikaze mission,” said Yassine Jafri of the economics department of Riyadh University. “The CMA cannot control the market; speculators hit back— whenever it makes a move against them.”

—Reuters