FTSE Russell poised to add Saudi Arabian stocks – billions of dollars set to pour into market

by | 27 Mar, 2018

Investors expect the FTSE Russell (the British provider of stock market indices) to include Saudi Arabia in their emerging markets category later this week. This addition would trigger billions of Dollars to pour into the biggest stock market in the Middle East.

Saudi has made strong progress in opening up its capital markets, and is engaged in a period of social change too, under Crown Prince Mohammed Bin Salman.

According to a Bloomberg report, an announcement is expected from the index compiler tomorrow, and fund mangers looking to invest on behalf of clients will be watching closely. Investing in Saudi stocks could prove to be highly lucrative, especially as its economy begins to move away from its dependence on oil exports to generate wealth.

The optimism over the possible addition of Saudi stocks to the FTSE Russell has boosted Saudi stock markets this Tuesday, with the Saudi index rising 0.9% to its highest level since August 2015.

Yesterday the Crown Prince met with top figures from Wall Street on his first official US visit since becoming King Salman’s heir apparent. The reason? New York financiers are desperate to launch one of the world’s biggest IPO’s ever for oil firm Saudi Aramco. A successful IPO could give the company a total valuation of up to $2trn, making it the largest oil company in the world by capitalization.

With all of these events underway, it’s no wonder investors are scrambling at the chance to buy into the Kingdom.

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