• SR 8 Billion Net Purchases by Foreigners in Saudi Stocks in 10 Weeks



    *Ikrami Abdullah from Riyadh


    Foreign investors recorded net purchases in Saudi stocks for the last ten consecutive weeks that worth eight billion riyals by capturing market opportunities before the FTSE promotion on March 18.

    According to the analysis of the reports' unit in the newspaper "AlEqtisadiah" that was based on data from the Saudi Stock Exchange Tadawul, net purchases over the past 10 weeks came after the purchase of foreign purchases of 15.8 billion SR compared to sales of about 7.8 billion riyals.

    The foreigners recorded net purchases of 985 million riyals last week ending March 7, after foreign purchases of 1.6 billion riyals, compared to sales of 584 million riyals.

    Foreign investors' purchases come ahead of the start of the Saudi market for emerging market indices starting on March 18.

    The share of foreign investors in the Saudi stock market jumped by the end of last week ending March 7 to an all-time high of 102.8 billion riyals, representing 5.12 per cent of the market value of 2 trillion riyals on the same date.


    Foreign ownership rose by 16.2 billion riyals in the last ten weeks, reaching 86.6 billion riyals at the end of the week ending December 27, 2018.

    The market value of foreign ownership increased by 18.7 per cent in conjunction with the overall market value of the market rising by 9 per cent and the increase in purchases in Saudi shares.

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


    In June 2015, CMA allowed qualified international institutional investors to buy local shares directly, whereas previously their investments were limited to "swap agreements" only.

    FTSE Russell decided in March 2018 that the Saudi stock market would be included in the Emerging Markets Index in stages from March 2019, ending at the end of the same year.

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

    According to Morgan Stanley, the Saudi market will weigh 2.6 per cent and 32 companies from the Saudi market that will be included in the Morgan Stanley Emerging Markets Index, where the first two phases will be joined in May 2019 and the second in August of the same year.

    In July 2018, S & P Dow Jones, the market leader of S & P Dow Jones, decided that the Saudi stock market will be upgraded from an independent market to its emerging markets index for the year 2019.

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


    * Economic Reports Unit​

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