Investment

Boursa Kuwait expects $2.8 billion of inflows on MSCI upgrade

Bloomberg/Raed Nasser

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The New York-based index compiler, whose emerging-market group of indexes has about $1.8 trillion of assets tied to it, will announce on 25 June whether it’s lifting the country from its current frontier classification.

Tuesday 25, June 2019

(Bloomberg)—The Head of Boursa Kuwait said that MSCI is expected to upgrade Kuwaiti equities to its main emerging-market index this week, which could trigger $2.8 billion of inflows from passive funds.

Mohammad Al-Osaimi, the acting Chief Executive Officer of Boursa Kuwait, “We have ticked all the boxes that are required by MSCI and we have also offered international investors additional services and products they were looking for and some changes in bylaws they requested.”

“We have touched base with them on our roadshows, we saw a comfortable response,” added Al-Osaimi.

This is significant for the small Gulf nation and its $98 billion stock market; local authorities have been trying to modernise trading infrastructure as well as attract foreign investors in the past few years.

The Kuwait Stock Exchange was upgraded by FTSE Russell less than a year.

Kuwait’s reforms include segregating stocks based on size and liquidity and separating shares that hardly trade in comparison to the biggest as well as most liquid names, primarily banks.

In Saudi Arabia, MSCI’s inclusion of shares in the emerging-market gauge is expected to lead to about $11 billion of inflows once fully implemented.

 

TAGS : Boursa Kuwait , MSCI EM Index, Tadawul, FTSE Russell

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