*Ikrami Abdullah from Riyadh
The share of foreign investors in the Saudi stock market recorded 102.4 billion riyals for the first time in its history, at the end of July 19, accounting for 5.1 per cent of the market value on the same date.
According to the analysis of the report unit in the newspaper "Al-Eqtisadiah" and based on data from Tadawul, foreign investors have publicized the announcement of international institutions to upgrade the Saudi market to the Emerging Markets Index by recording the highest net purchases during the year with a value of SR 10.9 billion by capturing investment opportunities in the market.
Foreign investors' purchases in 2018 are the highest since they were allowed to invest directly in the Saudi stock market in June 2015.
Net purchases, after foreign purchases, were amounted to SR 37.8 billion compared to sales of SR 26.9 billion since the beginning of this year.
The foreign investor shares in Saudi stocks include foreign strategic corporate partners, swap agreements, resident investors, qualified foreign institutions, and finally managed portfolios.
Foreign investors recorded their highest market share at the beginning of their direct investment, with a 5.13 percent stake of 86.4 billion riyals in August 2015.
In June 2015, the CMA allowed qualified international institutional investors to buy domestic shares directly, while their investments were previously limited to "swap agreements" only.
"The number of qualified foreign investors in the Saudi market is more than 120, while the other 180 are still considered," the Authority said.
As the third international institution to take the same step, S&P Dow Jones, decided that the Saudi stock market will be upgraded from an independent market to its emerging market index next year 2019.
"The promotion will take place in two phases, first with the quarterly rebalancing of March 18, 2019 at 50 percent, and the second with the annual review on September 23, 2019 100 percent."
This comes in response to positive structural reforms in the Saudi market to support foreign investment and the strong consensus among members of the investment community after consultations.
S&P Dow Jones for Indexes put the Saudi stock market's promotion as the third international institution, following the promotion of FTSE Russell in March, and following by the promotion of MSCI in June.
* Economic Reports Unit
