Saudi Arabia’s stock market rose in early trade on Sunday after index compiler FTSE added the country to its watchlist for potential upgrade and Egypt edged up after the Cairo government resigned.
Saudi Arabia’s main stock index rose 1.1 percent and most stocks were positive. Real estate companies did particularly well: Jabal Omar jumped 3.0 percent and Dar Al Arkan was up 2.8 percent.
FTSE on Friday added Saudi Arabia to its watch list for possible inclusion in the emerging markets category, following the opening of its stock market to qualified institutional investors in June.
An inclusion in FTSE and MSCI indexes could drive billions of dollars in passive fund investments into Saudi Arabia, although the process is likely to take years.
Egypt’s main index edged up 0.6 percent after President Abdel Fattah al-Sisi on Saturday asked Oil Minister Sherif Ismail to form a new cabinet.
The government had submitted its resignation shortly after the authorities arrested Egypt’s agriculture minister over corruption allegations.
Also, Egypt’s central bank said at the end of last week that core annual inflation rate had dropped to 5.61 percent in August from 6.49 percent in July.
“Overall, we view this as positive news for the markets – which in our opinion could give rise for expectations of a rate cut by the central bank,” brokerage Naeem said in a note.
