Saudi Arabia outpaces Asian giants with $18bn foreign equity inflow

Saudi investors monitor stocks at the recently opened exchange market department at the National Commercial Bank in Riyadh. (AFP)
Updated 29 August 2019
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Saudi Arabia outpaces Asian giants with $18bn foreign equity inflow

  • Saudi Arabia has attracted $18 billion in foreign equity inflows so far this year
  • MSCI added Saudi stocks to its emerging markets index in June

LONDON: Saudi Arabia became the top equity investment destination among emerging markets this summer according to the Institute of International Finance (IIF)

Supported by its upgrade to emerging market status, Saudi Arabia has attracted $18 billion in foreign equity inflows so far this year, the IIF said.

“The inclusion of local stocks to broad equity benchmarks acknowledges the progress made by Saudi Arabia in reforming its capital
market system,” the institute said in its latest report.

FASTFACT

$4.5 bn

Saudi Arabia attracted more than $4.5 billion in foreign equity inflows in May and $2 billion in the first three weeks of August.

MSCI added Saudi stocks to its emerging markets index in June, while the index will complete the upgrade by the end of August.

“We expect the second phase of the upgrade to attract an additional $5 billion in equity inflows,” IIF said. While the ongoing trade war between the US and China negatively impacted investment flows to some emerging markets in recent months, Saudi Arabia bucked the overall bearish trend.

The Kingdom attracted more than $4.5 billion in foreign equity inflows in May, and $2 billion in the first three weeks of August, it said.

The inclusion of Tadawul-listed shares to both the MSCI and FTSE emerging market indexes has attracted billions of dollars from global investment funds this year.


Saudi market regulator in talks with Aramco on IPO rules

Updated 18 September 2019

Saudi market regulator in talks with Aramco on IPO rules

  • Kingdom’s stock market regulator typically requires firms offer at least 20% to 30% of their shares when floating
  • Aramco’s primary listing will be on the Saudi stock exchange (Tadawul) in Riyadh

RIYADH: Saudi Arabia’s Capital Market Authority (CMA) is in talks with Saudi Aramco and its advisers about the regulatory requirements for listing on the domestic stock exchange, its chairman Mohammed bin Abdullah Elkuwaiz told Reuters.
“We continue to have discussions with the company and its advisers on both their readiness, as well as our regulatory requirements for the market,” Kuwaiz said on Wednesday.
Asked whether there will be any waivers or exemptions for the company’s listing, Kuwaiz told Reuters in an interview that the CMA is “still having those discussions.”
The Kingdom’s stock market regulator typically requires firms offer at least 20% to 30% of their shares when floating.
Aramco, whose chairman Yassir Al-Rumayyan said this week that the IPO would be ready within the next year and preparations were continuing despite Saturday’s attacks on its facilities, is yet to file its prospectus with the Saudi regulator.
“We receive waivers or exemption requests where needed and we review them on a case by case basis,” Kuwaiz said, in reference to those discussions.
Aramco’s primary listing will be on the Saudi stock exchange (Tadawul) in Riyadh, but the government is still considering a secondary listing overseas, Saudi finance minister, Mohammed Al-Jadaan told Reuters in an interview on Wednesday.