Saudi stocks are expected to recover after underperforming emerging-market benchmarks for the first time since 2020.

Investors are optimistic about the market's potential for next year, as Saudi Arabia is not included in US President-elect Donald Trump's proposed trade tariff hikes. This could make the country more attractive compared to China and Mexico.

Although share valuations are still relatively high, they have decreased from earlier this year, making it a more appealing entry point for investors. With escalating global trade tensions, Saudi Arabia's market dynamics may provide a safer haven for investment, positioning it favorably in the changing economic landscape.