DUBAI, UAE - Stocks in Saudi Arabia tumbled on Sunday in the wake of international media attention over the disappearance of Saudi journalist Jamal Khashoggi, who has not been since October 2.
Shares fell from the opening bell and within two hours the main index was down 7%, its biggest one-day drop in nearly four years.
One of the kingdom's leading stocks, SABIC (Saudi Basic Industries) shed 7.9%.
"It's the political environment. The market is reacting negatively to sentiment around the Khashoggi case and the political noise around it," Salah Shamma, head of investment for the region at Franklin Templeton Emerging Markets Equity, told CNBC.
Shamma commented the fundamentals of the Saudi Arabian economy remain unaltered.
It was only in June this year that MSCI announced that Saudi Arabia would be granted Emerging Market status next year. Its transformation in recent years, adoption of economic reforms, implementation of international accounting and auditing standards, and the opening up of its markets to foreign investment had aided its case.
The kingdom's Vision2030 which followed a major decline in oil prices saw international investors clamouring to be in Saudi Arabia.
On Sunday all that was being overshadowed by geopolitical events, and statements from the White House that the country could be sanctioned over events taking place in Istanbul, which are still under investigation.
Other stocks in the Gulf on Sunday, after opening higher, started falling as news filtered through about the situation in Riyadh.
At one point the Dubai index was down 1.4%.