EMERGING MARKET STATUS
MSCI upgrade may grow Saudi Arabia inflows
Dubai — Saudi Arabia’s financial sector is hoping billions of dollars of foreign portfolio funds will start flowing into the country, but the money may do little to boost a stock market depressed by low oil prices and rising taxes. On June 20, global equity index compiler MSCI will announce whether it is putting Saudi Arabia on a list for possible upgrade to emerging market status. Index firm FTSE will decide in September whether to make Riyadh a secondary emerging market. Then in late 2018, authorities aim to list oil giant Saudi Aramco in Riyadh, selling about 5% in what is likely to be the world’s biggest initial public offering of shares. All three events promise to draw large flows of passive funds — money that benchmarks itself against international indices — to Saudi Arabia and by raising the kingdom’s profile among global investors, attract a volume of active funds that could be even larger over the next couple of years. "Saudi Arabia will become tied to significant global c...
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