The stocks of The Kingdom of Saudi Arabia have suffered their largest decline in almost four years after Donald Trump, the President of the United States of America, threatened the country over the missing journalist named Jamal Khashoggi.
However, on Sunday, SPA, the state news agency reported that the kingdom ignored the threats and said that it would retaliate against the possible economic sanctions that will be imposed by the United States.
The Tadawul exchange fell by 7 percent in early trading after President Trump warned about “severe punishment” if the kingdom is discovered to have been involved in the disappearance of the Washington Post contributor.
The index endured its biggest decline since the oil prices dropped in December 2014, however, it was able to recover slightly into the afternoon, at just more than 4.5 percent down for the day.
The energy sector of the kingdom was among the worst that was affected, losing more than 5 percent, with the Saudi Basic Industries, the region’s largest petrochemicals company, down by more than 7 percent.
The head investment for the region at global fund manager Frank Templeton Emerging Markets Equity, Salah Sharma, stated: “It’s the political environment. The market is reacting negatively to sentiment around the Khashoggi case and the political noise around it.”.
Khashoggi is a resident of the United States and a critic of the Saudi government. He has not yet been seen since he visited the Saudi consulate in Turkey on the 2nd of October.
Turkish officials said that they feared that Khashoggi was already killed and dismembered by Saudi agents who are inside the consulate.
On Sunday, the government of Saudi Arabia hit back and said that it would respond to any punitive actions with “a bigger one.”
A senior source who was quoted by SPA stated: “The kingdom affirms its total rejection of any threats or attempts to undermine it whether through threats to impose economic sanctions or the use of political pressure.”
He added: “The kingdom also affirms that it will respond to any action with a bigger one.”
He continued: “The Saudi economy has vital and influential roles for the global economy.”