Party Mood Wobbles in Saudi Markets as a $20 Billion Wave Crests - Bloomberg:
Investors are starting to tune out the noise of the billions of dollars that flowed into Saudi bonds and stocks in the first half of the year after the kingdom’s upgrade to emerging-market status.
While the Saudi government has accelerated the pace of deregulating its capital markets, concerns about the economy’s reliance on oil and escalating tensions in the Persian Gulf are coming back to the fore.
The bulk of the estimated $20 billion in inflows from Saudi Arabia’s ascension to two key developing-nation equity indexes would materialize by end-August, according to EFG-Hermes. Meanwhile, the tailwind from its dollar bonds’ inclusion in JPMorgan Chase & Co.’s emerging-market gauges, happening gradually over nine months through September, has largely played out, said Arqaam Capital Ltd.’s Abdul Kadir Hussain.
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