A Saudi investor monitors share prices at the Saudi Stock Exchange, or Tadawul, in the capital Riyadh. The Saudi stock index yesterday dropped 2.7%, its biggest decline since August 24 and lowest close since October 6.

Reuters
Dubai

Saudi Arabia’s share index made its largest decline in two months yesterday after an International Monetary Fund (IMF) official said the kingdom was considering a wide range of fiscal reforms in response to a record budget deficit.
Other Gulf markets also fell, with renewed weakness in oil prices and mixed company results sapping investor confidence.
Fiscal reforms in Saudi Arabia, which could include lower energy subsidies, could hurt corporate profits in some sectors, especially the petrochemical industry.
Saudi Basic Industries Corp (Sabic), the Gulf’s largest listed company, fell 3.7% as 19 of Saudi’s 20 biggest stocks declined.
The IMF estimated yesterday that the kingdom would post a record budget deficit of well over $100bn this year, amounting to 21.6% of gross domestic product, as low oil prices shrink state revenues.
This was a marginally larger deficit than the IMF had previously forecast.
“The IMF report doesn’t bode well for 2016 either,” said Asim Bukhtiar, head of research at Saudi Fransi Capital. “The market is looking for clarity. In coming weeks we will learn official thinking on the 2016 budget, and right now the market is trying to gauge how big the spending cuts will be.”
Saudi Telecom Co plunged 7% after it reported a 31% drop in third-quarter profit that was bigger than analysts had forecast.
This period included the annual Haj pilgrimage, which is usually a money maker for the Saudi mobile operator as foreign visitors use expensive international roaming or local mobile SIM cards while in country.
The profit drop seemed to stun investors, who had lifted STC’s shares to an 11-week closing high on Tuesday before its results were announced.
Shares in Rabigh Refining And Petrochemical Co (PetroRabigh) tumbled 10.1% after the company swung to a third-quarter net loss.
The Saudi stock index dropped 2.7%, its biggest decline since August 24 and lowest close since October 6.
“The economy is having a significant wobble and that is affecting market sentiment,” Bukhtiar added.
In Egypt, Cairo’s main index rose 0.1% after central bank governor Hisham Ramez’s surprise decision not to renew his term when it expires in November.
Ramez had devalued Egypt’s currency and cracked down on black market currency trading, so investors will be pondering whether his exit will stall further devaluations.
Elsewhere in the Gulf, Dubai’s index fell 1.6% to 3,625 points; Abu Dhabi’s index dropped 1.2% to 4,530 points; Kuwait’s index fell 0.2% to 5,793 points; Oman’s index slipped 0.03% to 5,918 points, while Bahrain’s measure was flat at 1,249 points.