Kuwait upgrade to spark equity frenzy

Published: November 21, 2018

Kuwait has been reclassified as a secondary emerging market by the FTSE Global Equity Index, an upgrade from unclassified that is expected to bring up to US$1bn of foreign investment into the country. 

The FTSE index is due to include Kuwaiti equities in its secondary emerging market index with a 0.51% weighting in two tranches ending in December 2018. 

This is expected to bring in around US$750m to US$1bn in passive inflows into Kuwait, as tracker funds, ETFs and other passive securities will be forced to buy Kuwaiti equities as part of their mandates.

It will not just be dumb money moving into Kuwait, according to M. R. Raghu, executive vice president, published research at the Kuwait Financial Centre (Markaz). 

“Apart from passive inflows,” Raghu told EMEA Finance, “several active foreign investors are also expected to enter the markets due to the increased investor confidence arising out of the index inclusion.” 

There is further good news for Kuwait’s equity market,

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