Riyadh – Mubasher: Al Rajhi Capital expected the overall outlook for Saudi Arabian equities for the fourth quarter (Q4) of 2020 to be positive on improved economic activity. 

The travel restrictions imposed due to the Covid-19 pandemic have led to higher local market activities and more money spent domestically, Al Rajhi Capital said in a recent report.

For the petrochemical sector, the aggregate earnings are expected to improve whether on an annual or a quarterly basis, aided by improved product prices.

As for the hospitals, revenue and profitability will be positively supported by growth in in-patient revenue and the steady improvement in outpatient flow post-COVID 19.

“Retail oriented banks are likely to continue seeing healthy mortgage volumes. Accordingly, we expect cement volumes to continue to remain robust for Q4 2020, though both revenue and profitability growths are likely to be under check due to pressure on average realisation,” the report said.

As for the retail and consumer sectors, Al Rajhi predicted a mixed set of results as the impact of the higher value-added tax (VAT) and delay in school opening could be major headwinds for food and retail firms.