Saudi stock market might lead integration of regional exchanges

Saudi stock market might lead integration of regional exchanges
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Published May 9th, 2013 - 04:30 GMT via SyndiGate.info

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Abdullah Al-Suweilmy with Richard Banks, director, emerging markets of Euromoney, in Riyadh. (AN photo by Ahmed Fathy)
Abdullah Al-Suweilmy with Richard Banks, director, emerging markets of Euromoney, in Riyadh. (AN photo by Ahmed Fathy)
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Riyadh
,
Masic
,
BMG Financial Group
,
Bloomberg
,
Tadawul
,
John Sfakianakis
,
Jarmo T. Kotilaine
,
Basil Al-Ghalayini
,
Abdullah Al-Suweilmy

The Saudi stock market could possibly take the lead in any moves for integration of regional exchanges, say industry analysts.

Their reaction came in response to Tadawul CEO Abdullah Al-Suweilmy’s announcement that Saudi Arabia’s stock market is interested in expanding abroad and is in talks with regional exchanges about integration.

“We’ve been in discussion with various exchanges in the region and abroad and discussing the notion of joint products, joint indexes,” Al-Suweilmy was quoted as saying on the sidelines of a financial conference in Riyadh.

“Some regional integration would make sense and I have seen in recent months specifically that there have been more serious discussions about integration in the region,” he said in the Bloomberg report.

The Tadawul All Share Index has gained 5.9 percent this year. About 160 companies are listed on the market.

Basil Al-Ghalayini, CEO of BMG Financial Group, said: “In my opinion, since GCC countries are major world energy market players, their stock markets are likely to be susceptible to oil price. With its large market cap, almost larger than all Arab markets combined, the Saudi market will be taking the lead in this integration.”

John Sfakianakis, chief investment strategist at Masic in Saudi Arabia, said: “Any step that makes the Tadawul more approachable and international can only be a plus. Keep in mind that this is the largest market, in terms of liquidity, size and diversification (representation of broad list of sectors with sufficient liquidity) compared to other MENA markets.”

Jarmo T. Kotilaine, a regional analyst, commented: “Creating a market place where trading across the GCC exchanges becomes easier and less costly would obviously be beneficial for all concerned. The key question will have to do with the modalities of such integration.”

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