FTSE index upgrades Qatar

13 September 2015

Qatar to join secondary emerging markets index

  • Qatar Exchange to join London’s FTSE secondary emerging markets index in September 2016
  • Saudi Arabia’s Tadawul is now on the watchlist for the FTSE secondary emerging markets index

London-based FTSE Russell has announced that the Qatar Exchange will be promoted to its secondary emerging markets index from September 2016.

The first tranche will be transferred from the frontier markets index in September 2016 and the remainder in March 2017, to spread the liquidity demand.

Saudi Arabia’s stock market, the Tadawul, has also been put on FTSE’s watchlist for secondary emerging markets, following its opening to qualified foreign investors in June 2015.

The Kuwait Stock Exchange remains on FTSE’s secondary emerging markets watchlist.

The Palestine Exchange will be added to FTSE’s frontier markets index in September 2016.

Inclusion on the indices should bring foreign investment and liquidity to the Qatar Exchange. However, the upgrade to the US-based MSCI emerging markets index caused the Qatar Exchange index to peak just before the upgrade in mid-2014, then experience high volatility. The index is now 4.9 per cent below its level on 16 June 2014, the first day of trading after the upgrade took effect.

Over $940bn was pulled out of emerging markets between June 2014 and July 2015, according to the Netherlands’ NN Investment Partners.

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