Gulf stock markets surged in early trade on Tuesday but many investors stood on the sidelines before MSCI’s decision later on whether it will consider Saudi Arabia for inclusion in its emerging markets index.
Riyadh’s index edged up 0.1 percent after an hour of trade, with Saudi Basic Industries adding 0.6 percent.
While many institutional investors and portfolio managers are staying clear of the market because of uncertainties such as the June 23 vote on whether Britain will leave the European Union, Saudi retail investors bought small to mid-sized shares. The insurance sub-index added 0.7 percent.
Emaar the Economic City fell 1.7 percent to hand back recent gains that were triggered by expectations that it would benefit from Saudi Arabia’s economic reform plan, which was announced last week.
Dubai’s index rose 0.2 percent, but stocks that are usually heavily traded moved little. Dubai Islamic Bank was up 0.8 percent.
The largest listed stock on Abu Dhabi’s exchange, Etisalat , added 0.8 percent, helping pull the index up 0.1 percent. The telecoms operator, a constituent of the MSCI emerging market index, may see a small outflow of funds if MSCI decides on Tuesday to include China A-shares in the index, which would dilute the weighting of Etisalat and other Gulf constituents.
Source: Reuters
