It has been two years since the UAE and Qatar submitted their bids to Morgan Stanley Capital International (MSCI) for promoting their stock markets from frontier to an emerging market status. The delay in MSCI’s decision on the upgrade of UAE and Qatar stock markets is attributed to many reasons. Saudi Arabia is also seeking to have its stock market upgraded too.
MSCI decision will have significant implications and give a strong boost to GCC stock markets, especially with regard to attracting foreign investors to these bourses.
In fact, there is a complete separation between the performance of GCC economies and that of their bourses –in a very rare phenomenon in financial markets, since the stock market is a mirror of economy. But, the situation in the GCC countries is quite different as the performance of stock market is unrelated to the good performance of economy, which is supported by high oil prices.
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