Prime Highlights:
- Saudi Arabia drove a strong rally across GCC stock markets in January, outperforming major global benchmarks and attracting increased foreign investor interest.
- The market surge was supported by earnings optimism, economic strength, and reforms aimed at opening Saudi Arabia’s stock market to global investors.
Key Facts:
- The Tadawul All Share Index closed January at 11,382.08 points, marking its strongest monthly performance since February 2022.
- Saudi Arabia’s Capital Market Authority announced the stock market will open to all categories of foreign investors from February 1, allowing direct investment in the main market.
Background:
Saudi Arabia emerged as the strongest performer across Gulf equity markets in January, leading a broad regional rally as investor confidence improved on the back of earnings optimism and robust non-oil growth prospects, according to a report by Kamco Invest.
The Saudi stock exchange recorded a monthly gain of 8.5 percent, marking its best performance in five years. The rise helped GCC stock markets perform better than many major global indices, showing stronger interest from international investors.
Kamco Invest said the Tadawul All Share Index ended January at 11,382.08 points, its best monthly result since February 2022.
One of the main drivers of the rally was the announcement by Saudi Arabia’s Capital Market Authority that the stock market would open to all foreign investors from February 1, allowing direct participation in the main market. The move allows direct investment in the main market and removes long-standing restrictions.
To support foreign participation, the CMA abolished the Qualified Foreign Investor (QFI) framework, which previously required investors to manage at least $500 million in assets, and also eliminated swap agreements. Analysts say these changes are expected to enhance liquidity and deepen market participation.
Stock gains were led by Almasane Alkobra Mining Co., which surged 32.7 percent during the month. Saudi Arabian Mining Co. and Tourism Enterprise Co. followed with gains of 26.8 percent and 23.4 percent, respectively.
Trading activity also strengthened significantly. Total trading volume reached 4.9 billion shares, up 43.3 percent from December, while the value of trades rose 36.2 percent month on month to SR99.9 billion ($26.63 billion).
Elsewhere in the region, Oman’s stock exchange gained 7.9 percent, while Dubai advanced 6.4 percent. Kuwait and Bahrain were the only markets to post declines, falling 3.8 percent and 1.1 percent, respectively.
Kamco Invest added that the MSCI GCC Index climbed 7.8 percent in January, its strongest monthly performance in nearly six years, reflecting renewed investor interest across the Gulf amid improving global sentiment toward emerging markets.
