Saudi Arabia to join FTSE Russell and S&P Dow Jones EM indexes

By Sarah Lizee

Olympia, Wash., March 18 – The Saudi Stock Exchange is being added to the FTSE Russell Emerging Markets index and the S&P Dow Jones Emerging Market index, according to a press release.

Inclusion of Saudi Arabia into the FTSE Russell EM index will occur in five tranches over the next 12 months, the first of which was completed Monday.

The initial tranche of 25% will be split over March and April, 10% and 15% respectively, to ensure a smooth transition, the release said. The remaining 75% will be implemented in conjunction with quarterly reviews in June, September and March 2020.

Inclusion of Saudi Arabia into the S&P Dow Jones EM index started Monday for the first of two phases, with the second phase to be completed in September. Saudi Arabia is eligible for inclusion at 50% of float-adjusted market capitalization from Monday and at 100% on Sept. 23.

“Capital market reforms and enhancements implemented over the past two years have paved the way for index inclusion and reflect Tadawul's continued commitment to enhance the effectiveness of the Saudi capital market, foster an attractive investment environment for local and international investors and align its regulatory frameworks with international best practices,” the release said.

“Investment inflows resulting from index inclusion will further enhance liquidity and trading in the Saudi market, which is already among the most liquid of emerging markets worldwide, and further diversify opportunities for issuers and investors.”

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