Saudi Arabia’s sovereign-wealth fund has invested $7.5 billion in blue-chip American companies from Amazon.com Inc. to JPMorgan Chase & Co.
As the kingdom deploys windfall revenue from high oil prices to diversify its investments.
Saudi Arabia is snapping up U.S. stocks as the kingdom enjoys its strongest financial situation in years.
*Bloomberg tweet on Saudi’s sovereign wealth fund investment
Saudi Arabia’s sovereign wealth fund invests more than $7 billion to build new positions in US stocks including Amazon and Alphabet as markets were battered by recession fears https://t.co/sPwhWuH3qf
— Bloomberg (@business) August 16, 2022
The Public Investment Fund took on minority stakes across 17 companies, including Google parent Alphabet Inc. and Microsoft Corp.
- The rally that ended by June 30, according to U.S. securities filings.
- Each investment was worth $400 million to $500 million, the filings show.
Despite the purchases, the overall holdings of U.S.-listed securities in the $600 billion fund fell $3 billion in the quarter to $40.8 billion after other companies in its portfolio were routed by this year’s fall in share prices.
The S&P 500 index, which includes many of the new stocks PIF purchased, fell 20% in the first six months of this year on fears of rising inflation and a recession. The index has since recovered, but is down 9% year to date.
Saudi Crown Prince Mohammed bin Salman, chair of the Public Investment Fund, wants to shift the kingdom’s economy away from oil dependence.
- Saudi Arabia is snapping up U.S. stocks as the kingdom enjoys its strongest financial situation in years.
national oil company Saudi Aramco reported a 90% increase in quarterly net income, handing billions of dollars to the government to spend and invest in the kingdom.
While the kingdom, the world’s largest oil exporter, is trying to diversify away from oil by creating new industries such as tourism, mining and auto manufacturing, but oil remains the driver of the economy. Saudi Arabia registered 11.8% year-over-year economic growth in the second quarter on higher crude prices.