Saudi index rebounds after royal death

Shares on the Saudi Tadawul All-Share Index gained yesterday, erasing losses caused by the death of Crown Prince Nayef bin Abdulaziz Al Saud a day earlier.Shares The Saudi index rose 36 points to 6,754, as investor confidence was maintained and fears over a Greek exit from the euro zone were assuaged by belief in a concerted response by central banks. The benchmark stock index still ranges 15 per cent below its three-and-a-half-year high in April. Analysts say public knowledge of the prince's health problems meant his death had not come as a surprise, mitigating the effect his demise initially had on the markets. Crown Prince Nayef, who had been appointed as heir to King Abdullah only eight months ago, was known for his strong management of security issues. Experts say there is little reason to believe his likely successor, Prince Salman, the defence minister, will be any different to Crown Prince Nayef in economic policy. As Greeks voted for a new government yesterday, an election that is effectively a referendum on the European Union's bailout of its heavily indebted economy, concerns that voters would reject austerity measures were countered by optimism that the world's most influential central banks would unite to counter any disruptions caused by a Greek withdrawal from the euro zone. Al Rajhi Bank, the kingdom's largest listed lender, was among the day's winners, alongside Banque Saudi Fransi. Saudi Basic Industries Corporation, or Sabic,the world's largest petrochemicals producer, also gained, leading some analysts to believe investors are building their portfolios in anticipation of positive second-quarter results.