• 1.6 trillion riyals is the market value of 30 Saudi companies that will join the MSCI index



    * Ikrami Abdullah from Riyadh


    MSCI has announced that it will add 30 companies from the Saudi stock market during the first stage as of May 28, with a total weight of 1.42% of the MSCI Emerging Markets Index.

    According to the analysis of the reports unit in the newspaper "AlEqtisadiah" that was based on data from the Saudi Stock Exchange (Tadawul), the market capitalization of the 30 listed companies is about 1.6 trillion riyals, which is equaling 81.1 percent of the market capitalization of 1.96 trillion riyals at the end of trading on May 13.

    The lion's share of companies in the banking sector, which contributes nine banks, accounting for about 30 per cent of the number of listed companies from the Saudi stock market.

    The market value of the nine banks is 40% of the market value of the 30 companies, equivalent to SR 638 billion.


    SABIC, the largest listed company by market value, topped SR327 billion, which was accounting for 20.6 per cent of the total, followed by STC with a market capitalization of 198.4 billion riyals, which was representing 12.5 per cent of the total.

    Thirdly, Al-Rajhi Bank has a market value of 165 billion riyals, which was representing 10.4 per cent of the total, followed by National Commercial Bank with a market value of SR 163.5 billion, which was representing 10.3 per cent of the total.


    The 30 companies are: SABIC, Saudi Telecom, AlAhli Bank, Al-Rajhi Bank, Saudi Electricity, Ma'aden, Samba, Almarai, Riyadh Bank, SABB, Yansab, Saudi Fransi bank, Al Jazira Bank, Alinma, SAFCO, Petro Rabigh, Saudi Kayan, Savola, Jarir, Etihad Etisalat - Mobily, Tasnee, Albilad, Saudi Group, Dar Al-Arkan, Advanced Petrochemical Company, Emaar, Tawunyia, Saudi Cement, Tamwin, Bupa Arabia.


    On June 20, 2018, MSCI announced a decision to upgrade the Saudi stock market to the Emerging Markets Index.

    According to Morgan Stanley, at that time, the Saudi market would weigh 2.6 per cent, as 32 companies from the Saudi market will be included in the Morgan Stanley Emerging Markets Index.

    The joining will be in two phases, as the first in May 2019 and the second on August 29 of the same year.


    Unlike Morgan Stanley, the first phase of the process of joining the global indicators "FTSE Russell" and S & P Dow Jones Emerging Markets was done on March 18, 2019, according to closing prices Thursday, March 14, 2019.


    Based on what FTSE Russell announced, as part of the plan to join the Saudi stock market for emerging market indices, the first phase of the five phases was completed.

    The first phase represents 10 per cent of the total weight of the Saudi financial market.

    On the same date, the first stage of the Saudi Stock Market's accession to the S & P DJI Index, which will take place in two phases.

    The first phase was implemented at 50% of the total weight of the Saudi financial market.


    FTSE Russell decided on March 28, 2018 to combining the Saudi market into emerging secondary markets, in phases beginning in March 2019 and ending in March 2020 due to the size of the market.


    The Foundation said that the accession will be in five stages:18 March 2019 of 10 per cent, 1 May 2019 of 15 per cent, June 24 of 25 percent, 23 September 2019 of 25 per cent and 23 March 2020 of 25 per cent.


    On July 25, 2018, Standard & Poor's Dow Jones has decided to upgrade the Saudi market to an emerging market as of March 2019.


    The Foundation said that the upgrade will take place in two phases, the first in conjunction with the rebalancing of the quarter on 18 March 2019 by 50 per cent, and the second with the annual review on 23 September 2019 at 100 per cent.


    As a result of the promotion of emerging markets, foreign investors continued to record net purchases in Saudi stocks last 18 consecutive weeks "more than four months", which worth 20.2 billion riyals, through capturing opportunities in the market before and after the promotion of FTSE and S & P.


    Net purchases in the last 18 weeks after the purchase of foreign purchases were 44.3 billion SR compared to sales of about 24.1 billion riyals.

    Foreign ownership rose by 33.6 billion riyals in the last 18 weeks, where it was 86.6 billion riyals for the weekend ending December 27, 2018.


    The market value of foreign ownership increased by 38.8 per cent in conjunction with the overall market capitalization of 13.1 per cent, in addition to increasing their purchases in Saudi shares.

    The share of foreign investors in Saudi stocks includes both strategic foreign corporate partners and swap agreements, Resident investors, qualified foreign institutions, and finally managed portfolios.


    In June 2015, the Saudi Capital Market Authority has allowed qualified investors from international institutions to purchase local shares directly, whereas previously their investments were limited to "swap agreements" only.


    * Economic Reports Unit​

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