US-Venezuela conflict: Saudi Arabia’s stock market slumped for the third day in a row on Tuesday, January 6, as investors weighed the impact on oil prices amid heightened geopolitical risks.
Oil prices fell back after ending higher in volatile trade on Monday following the capture by US forces of Venezuelan President Nicolas Maduro in a weekend raid.
Although analysts expect little immediate impact on crude oil supplies from the US-Venezuela crisis, price pressure could rise if the U.S. lifts its embargo on Venezuelan oil, potentially leading to increased output.
Analysts largely have a bearish outlook for crude oil prices in 2026 amid growing supply and weak demand.
Tadawul All Share index slumps 2.5% in 3 days
Against this backdrop, Saudi Arabia’s Tadawul All Share (TASI) index fell to the day’s low of 10,291.24, down 0.32% from its last closing level of 10,325.20. During the three days, the index has lost almost 2.44%.
Regional tensions and a bearish outlook for oil prices in 2026 weakened market sentiment.
Joseph Dahrieh, managing director at Tickmill, told Reuters on January 5 that a healthy growth in the non-oil economy, the prospect of monetary easing in 2026, and upcoming fourth-quarter earnings releases may provide the catalysts needed for a rebound.
As per the report, Saudi Arabia’s non-oil private business sector remained in growth territory in December, though expansion slowed to a four-month low and new order growth decelerated, a survey released on Monday found.
Meanwhile, in another development, the Organisation of the Petroleum Exporting Countries and allies (OPEC+) kept oil output unchanged over the weekend.
TSAI: Technical outlook
Commenting on the technical outlook for the index, Anshul Jain, Head of Research at Lakshmishree, said that TASI has remained locked in a wide 10,000 to 13,000 range for nearly 55 months and is now drifting toward the lower end of this long-standing band.
The price structure remains weak, with daily, weekly, and monthly key moving averages all sloping downward and acting as persistent overhead resistance, signalling sustained distribution rather than accumulation.
“Momentum across timeframes lacks strength, and participation has not shown any signs of institutional support near current levels. As the index approaches range support, downside risk remains elevated if demand fails to emerge decisively. Any bounce is likely to be corrective and capped near declining averages. A decisive breakdown below the lower boundary would mark a major structural failure and open room for a deeper leg lower, while only a reclaim of key moving averages would neutralise the bearish bias,” he cautioned.
(With inputs from Reuters)
Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
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