Iraq’s stock exchange has started to decline following a short-lived rally triggered by the resignation of Prime Minister Nouri al-Maliki on 14 August.

The Iraq Stock Exchange General Index leapt from a low of 87.22 points in mid-August to a peak of 101.64 points on 21 August, as investor confidence was buoyed by Al-Maliki’s departure and the appointment of Haider al-Abadi as the new prime minister-designate.

Confidence has since dwindled, with the index falling by 1.65 per cent to 99.96 on 24 August. It declined a further 1.19 per cent to 98.77 per cent on 25 August.    

The change of Iraq’s leadership is expected to improve national security and support the country’s fight against Islamic State in Iraq and Syria (Isis) militants, which have seized swathes of Iraq and Syria in an effort to establish their own Islamic state, or Caliphate.

However, security concerns persist with nine people killed in a suicide bomb attack on a Shia mosque in Baghdad on 25 August, according to local reports.

The recent execution of US journalist, James Foley by Isis forces after being held hostage for two years has further heightened fears of the capabilities of the militant group.

Isis forces currently hold the Iraqi city of Mosul, which was seized in June.