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The first phase of the Saudi Emerging Markets Market FTSE Russell and S & P Dow Jones Based on closing prices on Thursday, March 14, 2019.
The auction period during last Thursday's session was marked by active exchanges around 38.5 million shares worth 1.4 billion Riyals were issued through 5.4 thousand transactions due to the inflow of foreign funds into the "FTSE Russell" index.
In March 2018, FTSE announced that the Saudi market would become the secondary emerging market once the membership conditions were met.
The contract will be included in 5 stages due to its significant volume, starting today from March 18 and ending in March 2020, andThe Saudi market will represent approximately 0.25% of the global FTSE indices and 2.7% of the emerging markets index.
The following table illustrates the steps of the Saudi market for the FTSE Russell Emerging Markets Index:
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Steps to the integration of the Saudi FTSE Russell index market to emerging secondary markets |
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Steps |
First slide |
Second slide |
The third slide |
The fourth slide |
The fifth slide |
|
Revision date |
March 2019 |
April 2019 |
June 2019 |
September 2019 |
March 2020 |
|
Size of the slide |
10% |
15% |
25% |
25% |
25% |
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Total |
10% |
25% |
50% |
75% |
100% |
FTSE Russell said that the inclusion of any business will be done in 5 steps coinciding with the inclusion of the market. As in the following table:
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49% steps from the FTSE Russell index for emerging secondary markets |
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The slides |
First slide |
Second slide |
The third slide |
The fourth slide |
The fifth slide |
|
Revision date |
March 2019 |
April 2019 |
June 2019 |
September 2019 |
March 2020 |
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Company participation ratio of 49% |
4.90% |
7.35% |
12.25% |
12.25% |
12.25% |
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Total |
4.90% |
12.25% |
24.50% |
36.75% |
49.00% |
The Financial Markets Authority (AMC) expects Saudi Arabia's membership in the FTSE Russell index to increase market liquidity as a result of the FTSE index. Increasing financial flows of foreign institutional investors using the index to track and value the large assets that they manage.
"Once the Saudi market is completed, it will be the largest market in the Middle East with $ 5.5 billion in cash," said FTSE Russell Mark Marks, former President and CEO of FTSE Russell Index ..
He pointed out that the Saudi market was able to move to an advanced market 3 to 5 years after the realization of additional conditions, including the development of settlement and financial derivatives systems and the easing of restrictions on foreign ownership.
The Saudi stock market was added to the watch list of the FTSE Russell index in 2015 following the announcement of the launch of the program of qualified foreign investors and continued to maintain its rating in the list of countries in 2016.
In October 2017, the FTSE Russell Index Index was launched. FTSE Saudi InclusionA comprehensive set of global, regional and local indicators that can be used as a transitional tool to help local and foreign investors who want to identify the performance of the Saudi financial market through the index.
Dow Jones, of Standard & Poor's, announced last July that the Saudi market would move to an emerging market in two phases, the first to 50% today and the full 100% listing in September 2019. .
This was in response to the positive structural reforms undertaken by the Saudi market to support foreign investment, as well as the important consensus among members of the investment community.
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The steps of the inclusion of the Saudi market index "S & P Dow Jones"For emerging markets |
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The first step |
second step |
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Date of accession |
March 18, 2019 |
September 23, 2019 |
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Market size * |
50% |
100% |
* Percentage of the total weight of the Saudi market in the index.
Standard & Poor's Dow Jones estimated that the weighting of Saudi markets in its Emerging Markets Index was 2.57% at the time of full listing and that Saudi Arabia's share in its world index was 0.28%. The following table shows the weight of the Saudi market during the steps of the Dow Jones Standard & Poor's indices:
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The Saudi market weighed in during the stages of its inclusion in the "Standard & Poor's" indexes |
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Indicator |
50% |
100% |
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Standard & Poor & # 39; s Emerging Markets Index |
1.30% |
2.57% |
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From Standard & Poor's World |
0.14% |
0.28% |
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