#SaudiArabia Taps Wall Street Speed Traders to Boost Its Market - Bloomberg

Saudi Arabia Taps Wall Street Speed Traders to Boost Its Market - Bloomberg

Saudi Arabia is ramping up efforts to lure high frequency trading firms — a campaign that’s already brought in major players from Citadel Securities to Hudson River Trading — as it looks to bolster activity on the Middle East’s largest stock market.

The Saudi Tadawul Group Holding Co. is working with some of Wall Street’s fastest and most secretive HFT firms to incorporate their feedback as it revamps its derivatives market framework, according to people familiar with the matter. The operator of the kingdom’s stock exchange is also expanding its international roadshows — widening outreach beyond the US and Europe to Asian markets such as Japan and India, the people said, requesting anonymity to discuss private information.

Momentum is already building. Citadel Securities and Hudson River Trading are seeking to ramp up operations in the kingdom, while Tower Research Capital is among market-making firms testing their algorithms on the exchange, some of the people said.

The firms haven’t disclosed details of their activity on the Saudi exchange and don’t appear among its official market makers. Still, their involvement signals that even the most latency-sensitive international players are deepening their footprint in the kingdom.

Spokespersons for Citadel Securities and Hudson River Trading declined to comment while those for Tower Research didn’t respond to requests for comment.

Saudi Arabia’s outreach to algorithmic and quant-driven trading firms began around the time of oil giant Aramco’s $26 billion IPO in 2019, the people said, and has since dovetailed with the kingdom’s Vision 2030 agenda to expand its capital markets and boost foreign participation.
Bolstering Infrastructure

In 2023, Tadawul’s technology unit, Wamid, launched co-location services that allow trading firms to host servers adjacent to the exchange’s matching engine — a critical infrastructure upgrade for high-frequency strategies. Tadawul also tapped financial technology provider Pico to help roll out the infrastructure and link the bourse to other markets.

The Saudi Exchange has also established a dedicated division to manage relations with international investors, which has helped strengthen ties with clients including quants, hedge funds and HFTs, said Chief Executive Officer Mohammed Al-Rumaih.

“We already have many of these clients on the exchange from the US, Europe and the UK, and we see the biggest growth opportunity now coming from Asia,” he said.

Tadawul is the Gulf’s largest stock exchange, with the average daily traded value of equities standing at about $1.7 billion as of April end, according to the exchange.

Shares of the exchange trade at one of the richest valuations among global bourse operators, reflecting investor bets on a surge in volumes aligned with the kingdom’s broader economic ambitions. The stock trades at 34 times forward earnings — well above peers such as CME Group Inc. and Deutsche Boerse AG.

Since launching co-location services, “tier 1” HFT firms are now well established in the kingdom, said Yazeed AlDomaiji, CEO of Wamid. “We’re now in the process of developing the next phase of our co-location offering and expanding to target tier 2 and tier 3 HFTs,” he added, without naming specific firms.

High-frequency trading accounts for up to 25% of daily volume on the Tadawul, according to exchange officials — well below the average seen on global bourses. For example, Nasdaq Inc. says it’s estimated that 50% of stock trading volume in the US is driven by such activity.

Market depth and turnover too remain modest by global standards, limiting scalability for larger electronic strategies. In response, Tadawul has enlisted firms such as Morgan Stanley Saudi Arabia and Merrill Lynch KSA as registered market makers to improve liquidity and price discovery.

Bringing in more HFT firms will be key to that effort, as these firms can deploy proprietary trading books without the constraints that apply to banks.

Tadawul is also pursuing other initiatives, including the launch of more exchange-traded funds tracking Saudi shares, and efforts to bring more companies to market.

Products such as single-stock futures and index-linked contracts are also gaining traction in Saudi Arabia, gradually expanding the toolkit available to quantitative and multi-asset traders. The growing product set along with the planned overhaul of the derivative segment is expected to support more complex HFT strategies that arbitrage inefficiencies across cash and derivatives markets.

“With the infrastructure falling into place, we expect liquidity to increase significantly,” said Jarrod Yuster, founder and CEO of Pico. “In five years, volumes on the exchange could look completely different.”

Trump Middle East Trip: White House Touts $200 Billion in #UAE Deals - Bloomberg

Trump Middle East Trip: White House Touts $200 Billion in UAE Deals - Bloomberg

US President Donald Trump has secured $200 billion in deals during a visit to the United Arab Emirates, according to the White House, including agreements involving artificial intelligence that will boost the Gulf nation’s technological ambitions.

“These deals will significantly expand investment in the United States and U.S. market access in the United Arab Emirates,” the White House said in a statement Thursday.

The announcements came during the third and final leg of the US president’s visit to the Middle East, where he highlighted investments earlier in the week of $600 billion from Saudi Arabia and more than $243 billion with Qatar. Trump made scoring business deals a centerpiece of his first planned overseas trip since returning to office.

The deals and initiatives with the UAE include:

• A $14.5 billion commitment from Etihad Airways to invest in 28 Boeing Co. 787 and 777X aircraft powered by GE Aerospace engines.
• ExxonMobil Corp., Occidental Petroleum Corp., and EOG Resources Inc. plan to partner with the Abu Dhabi National Oil Company to expand oil and natural gas production valued at $60 billion.
• A $4 billion primary aluminum smelter project that Emirates Global Aluminum will develop in Oklahoma.
• RTX Corp. is partnering with Emirates Global Aluminum and the UAE’s Tawazun Council on a gallium project to shore up US critical mineral supplies.

AI has been central to many of the agreements Trump has negotiated in the region. Gulf nations have been eager to secure greater access to cutting-edge chips in a bid to become hubs for the emerging technology and diversify their economies.

 

Thursday’s announcements include:Plans for Qualcomm Inc. to help develop a new “global engineering center” in Abu Dhabi focused on AI and data centers.

A new AI campus in the UAE that will be built by G42, the crown jewel of the country’s tech ambitions, and operated in partnership with several US companies. The US Commerce Department said the campus will include 5 gigawatts of capacity for AI data centers, providing a regional platform for large-scale providers of cloud or computing services.

Amazon Web Services Inc., e& — formerly telecom company Etisalat — and the UAE Cybersecurity Council will partner on bolstering public cloud services in the country.

The Trump administration had been weighing a deal that would allow the UAE to import more than a million advanced Nvidia Corp. chips. Trump has also worked out arrangements for parties in Saudi Arabia to acquire tens of thousands of semiconductors from Nvidia and Advanced Micro Devices Inc. The flurry of AI deals, though, has opened a rift within the administration, where China hawks are increasingly concerned that the projects put US national security and economic interests at risk.

Thursday’s agreements build on a pledge from the UAE to invest $1.4 trillion in the US over 10 years, including in AI infrastructure, semiconductors, energy and manufacturing, following a meeting in March between Trump and the country’s national security adviser, Sheikh Tahnoon bin Zayed Al Nahyan.

Trump earlier this year announced plans by Abu Dhabi’s MGX for a $100 billion AI infrastructure venture. MGX is part of Sheikh Tahnoon’s sprawling $1.5 trillion empire, which includes wealth funds and the AI company G42.

G42 has established itself as an up-and-coming tech conglomerate with connections to US companies, including OpenAI Inc. and Amazon.com Inc.

#Qatar’s Wealth Fund Plans $500 Billion US Push Over Next Decade - Bloomberg

Qatar’s Wealth Fund Plans $500 Billion US Push Over Next Decade - Bloomberg

During his first 15 years at Qatar Investment Authority, Mohammed Al Sowaidi helped establish its US presence and scout opportunities. Now, as head of the $524 billion state-backed entity, he’s pledging to invest an amount nearly equal to the fund’s current size, as part of a major commitment by the Gulf nation.

QIA plans to invest an additional $500 billion in the US over the next decade, Al Sowaidi said in an interview in Doha. The sweeping new outlays will target areas traditionally favored by the fund — such as artificial intelligence, data centers and health care — while also aligning with President Donald Trump’s agenda to reindustrialize the US, he said.

The $500 billion accounts for nearly half of the total $1.2 trillion economic pledge by Qatar during Trump’s visit this week.

“We’re not shifting away from other markets — we’re increasing our exposure to the US,” Al Sowaidi said. The current US policy environment offers a “more promising direction” for long-term capital, he said.

To be sure, the QIA is not alone in pursuing an aggressive, US-focused investment strategy among Middle East funds. Saudi Arabia’s Public Investment Fund, state-owned entities in the United Arab Emirates, and the Kuwait Investment Authority are also looking to deploy billions across similar sectors — raising the likelihood of competition for the same deals and the risk of overpaying for assets.
Bigger Deals

Al Sowaidi took over as the chief executive officer last year during a pivotal moment for the fund, with an expansion of the country’s gas projects expected to funnel billions of dollars into its coffers. At the same time, Doha is no longer hamstrung by outlays for large projects like the 2022 FIFA World Cup, which is estimated to have cost $300 billion.

With fresh inflows expected, Al Sowaidi plans to steer the fund toward providing capital to large companies, taking stakes in listed businesses and prioritizing bigger deals.

That marks a departure from the QIA’s recent focus on smaller venture capital deals. Still, Al Sowaidi said the move isn’t “an actual strategic shift or pivot,” but rather a “further evolution” of the fund’s approach to keep pace with rapid global change.

The QIA is already the world’s eighth-largest sovereign wealth fund and owns a string of high-profile assets including London’s Harrods department store and the Shard skyscraper. But after years of relatively quiet dealmaking, Al Sowaidi’s plans show the fund is ready to be back in the spotlight.

Al Sowaidi joined the QIA in 2010, when it was led by Sheikh Hamad bin Jassim bin Jaber Al Thani, a former prime minister who’s widely regarded as among the most high-profile investors in the Middle East. Sheikh Hamad was ultimately replaced at the QIA by Ahmed Al-Sayed, who helped orchestrate large deals including Glencore Plc’s $29 billion takeover of Xstrata Plc.

Al Sowaidi, for his part, spent most of his early years at the fund in the Americas, where he helped establish a US office and eventually worked his way up to become chief investment officer for the region.

He holds bachelor’s degrees in finance and statistics from the University of Missouri, and has held roles including as the head of private equity funds and president of the QIA Advisory office in New York. The QIA was then known for its work in snapping up high-profile stakes in the likes of Barclays Plc and Credit Suisse.
Gas Windfall

Qatar is already one of the world’s richest nations and among the top exporters of liquefied natural gas. But the government’s plans to significantly expand that output is set to add more than $30 billion a year to state revenues.

Some of this cash will be funneled into the QIA. The research consultancy Global SWF recently projected the QIA’s total assets will surge to $905 billion by 2030, meaning it would be vaulted into the ranks of other high-profile investors across the region like Saudi Arabia’s PIF and the Abu Dhabi Investment Authority.

The QIA is already positioning itself to prepare for significant outlays.

Al Sowaidi said the fund typically takes minority stakes in successful businesses, with deal size varying widely by asset class. “In public equity, we can go big,” he said.

“In private equity, we’re capable of multibillion-dollar transactions, but we can also stay nimble — especially in sectors like technology or health care.”

Such a move would be welcome news for the private equity industry. For years, high interest rates have put a damper on global dealmaking. When private equity firms aren’t able to sell their portfolio companies at a healthy pace, they can’t return capital to their investors. Then that money can’t be recycled into new funds.

The QIA’s efforts in that space would help get fundraising moving for the industry again — and make up for the pullback that’s expected from the $925 billion PIF, which has started to increasingly focus on domestic investments.

Already, financial firms are eager for the chance to work more closely with the QIA. Eduardo Saverin’s B Capital, for instance, unveiled plans to set up offices in Qatar earlier this year. Days later, BlackRock Inc.’s Global Infrastructure Partners, said it would set up in Doha too.

Those outside Doha will get more insight into Al Sowaidi’s thinking next week, when he speaks at the annual Qatar Economic Forum, where top finance executives from around the world and key names from Trump’s orbit — including his son Eric and Tesla Inc.’s Elon Musk — are scheduled to speak.

Doha had until recently largely stayed away from the race for regional financial dominance, even as a flurry of Wall Street firms announced plans to set up their regional headquarters in Riyadh and hedge funds flocked to Abu Dhabi.

But Al Sowaidi’s plans show the gas-rich nation is intensifying efforts to catch up.

Sheikh Tahnoon’s IHC nears deal for stake in Richard Caring’s Ivy hospitality empire #UAE #AbuDhabi

Sheikh Tahnoon’s IHC nears deal for stake in Richard Caring’s Ivy hospitality empire

Richard Caring is in advanced talks to sell a significant portion of his UK hospitality empire — which includes the Ivy restaurants chain and London private members’ club Annabel’s — to an entity controlled by the powerful Abu Dhabi royal Sheikh Tahnoon bin Zayed al-Nahyan. 

The talks between Caring, dubbed “King of Mayfair”, and Sheikh Tahnoon’s sprawling holding company IHC may result in a deal that could exceed more than £1bn, according to people with knowledge of the matter. 

A deal would mark a partial exit for Caring, a 76-year-old rag trader-turned-hospitality mogul who has over decades assembled a portfolio of some of London’s best-known bars, restaurants and clubs. It would also hand the entrepreneur funding to take his hospitality brands such as The Ivy into new markets. 

The details remain in flux but are anchored around Caring’s efforts to sell a stake in Troia, the company that owns the Ivy Collection, consisting of more than 40 restaurants in the UK and Ireland. 

However, the talks have expanded to include Caring’s other assets, such as his elite private members’ clubs in Mayfair — including Annabel’s, George and Harry’s Bar. Those are held in an entity called Mark Birley Holdings that is co-owned by Qatari royal and former prime minister Sheikh Hamad bin Jassim bin Jaber al-Thani.

Besides Troia and Mark Birley Holdings, Caring’s other companies include casual dining chain Bill’s and Caprice Holdings, which owns high-end restaurants including ​​Sexy Fish, Scott’s and Bacchanalia. 

The people involved stressed there was no guarantee of a deal being agreed and highlighted shifting discussions over price and which assets could be included. 

Caring controls his empire through a complicated web of investment vehicles, which ultimately are owned through offshore holding companies in Jersey and the British Virgin Islands. The hospitality mogul also raised debt that spans these companies, with corporate filings showing that Troia, Caprice and Mark Birley Holdings have jointly guaranteed bank loans. 

IHC, the most valuable company on Abu Dhabi’s stock exchange by market capitalisation, is the sprawling conglomerate controlled by Sheikh Tahnoon, the United Arab Emirates’ national security adviser and a brother of President Sheikh Mohamed bin Zayed. 

One of Abu Dhabi’s most powerful men, Sheikh Tahnoon also leads the UAE’s push into artificial intelligence through his G42 group. He visited the White House earlier this year and regularly meets top US tech executives. 

IHC already has various hospitality investments. Its listed subsidiary Alpha Dhabi Holdings has a controlling stake in the National Corporation for Tourism and Hotels, whose assets include luxury hotels in Abu Dhabi, the Maldives and Seychelles. Through a joint venture with Monterock International, an investment group with a large hospitality portfolio, Alpha Dhabi also owns stakes in brands including Greek luxury resorts chain Nammos. 

IHC said it “regularly engages in discussions around diverse opportunities across sectors” and that it discloses “any material developments once a transaction is confirmed”, in line with applicable regulations. 

Caring declined to comment.

Major Gulf markets varied as oil oversupply fears loom | Reuters

Major Gulf markets varied as oil oversupply fears loom | Reuters

Saudi Arabia's benchmark stock index (.TASI), opens new tab ended slightly lower on Thursday, weighed down by a fall in oil prices on expectations for a U.S.-Iran nuclear deal, while a surprise build in U.S. crude oil inventories last week heightened investor concerns about oversupply.

Oil prices are a catalyst for the Gulf's financial markets. Brent crude futures were down $1.98, or 3%, to $64.11 a barrel at 1217 GMT.

Earlier this week, investors were met with a wave of optimistic developments — from a breakthrough in the U.S.-China trade tensions to a series of high-profile investment agreements in the Middle East during U.S. President Donald Trump's Gulf visit.

But the enthusiasm faded on Thursday, with MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab inching 0.15% lower and Wall Street futures 0.5% weaker.

However, performance across Gulf stocks varied on Thursday. A 10% drop in construction material maker Zamil Industrial (2240.SE), opens new tab dragged Saudi Arabia's benchmark index lower by 0.41%.

Dubai's main share index (.DFMGI), opens new tab closed up 0.73%, supported by a 4.6% jump in toll gates operator Salik Company (SALIK.DU), opens new tab.

In Abu Dhabi, the benchmark index (.FTFADGI), opens new tab settled up 0.04%, while Qatar's benchmark stock index (.QSI), opens new tab closed down 0.18%.

Outside the Gulf, Egypt's blue-chip index (.EGX30), opens new tab, extended gains to a fourth straight session, closing up 0.36%.