Trista Kelley, provided by Published 4:57 am PST, Friday, December 14, 2018 Reuters/Fahad Shadeed The Saudi government has been propping up the stock market when negative news sends the market lower, the Wall Street Journal reported. The murder of journalist Jamal Khashoggi was one such example of final-hour buying by funds linked to the government. The October murder of columnist Jamal Khashoggi spooked investors into dumping Saudi stocks. The Saudi government then swooped in to buy them back, shoring up the market. It’s a familiar pattern when things go south in the country’s equity market, according to an investigation by the Wall Street Journal. Citing people familiar with the matter, the WSJ reported that the Saudi government places massive buy orders, often in the last few minutes of trading, to send the market higher on negative trading days. The government doesn’t buy the shares directly, but purchases them via fund managers at Saudi firms that aren’t required to reveal their clients. The stock interventions corresponded to news flow relating to the Saudi government’s involvement in Khashoggi’s death. For example, the WSJ highlighted in a chart how the market opened with a sharp drop after President Donald Trump vowed “severe punishment” if… Read full this story
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