Saudi Arabian stock market to open to foreign investors

Saudi traders

Related Stories

Saudi Arabia's stock market will open up to foreign investors for the first time, the country has announced.

The move, which should happen in the first half of 2015, sparked a 3% rise in the Tadawul index on Tuesday.

The Saudi market is the biggest in the Middle East and the second biggest in the world, next to China, that is closed to direct foreign investment.

Currently, foreigners can only gain exposure to Saudi stocks through derivatives and investment funds.

After the market is opened up, foreigners will be able to buy Saudi stocks directly on the Tadawul.

"The market will be open to eligible foreign financial institutions to invest in listed shares during the first half of 2015, with God's permission," the country's Capital Market Authority said.

The move is part of wider government efforts to diversify the Saudi economy away from oil.

'Massive move'

Analysts expect there to be a great deal of interest in the market as investors look to buy into some of the Middle East's blue chip companies and into an economy that is expected to grow by more than 4% this year.

"This is a massive move for Saudi and for the region," said Rami Sidani, head of Middle East investments at fund manager Schroders, who forecast the country would "definitely attract massive inflows" as a result of the move.

Experts say it will also benefit the country, which will be seen as a mainstream destination for big international investors.

"This is a potential game-changer for the region, a very important milestone that people have been waiting for," said Salah Shamma at fund manager Franklin Templeton.

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Features

  • Image of Ankor Wat using lidarJungle Atlantis

    How lasers have revealed an ancient city beneath the forest


  • Peaky Blinders publicity shotBrum do

    Why is the Birmingham accent so difficult to mimic?


  • Main Event bar and grill'Just nuke 'em'

    Views on Syria air strikes from a small US town


  • A deer is seen bugling in the morning mist in Richmond Park in LondonDay in pictures

    A selection of news photos from around the world


From BBC Capital

Programmes

  • Islamic StateClick Watch

    Can the location of Islamic State militants be found with open source data?

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.