Funds tracking MSCI’s emerging markets index are likely to start buying several stocks in the United Arab Emirates and Qatar that will see their benchmark weightings increased after the end of trading on Tuesday.
These include Emaar Properties, Dubai Islamic Bank and First Gulf Bank in the UAE, plus Doha’s Industries Qatar, Qatar National Bank, Doha Bank and Commercial Bank of Qatar.
Gulf International Services will join the benchmark for the first time, while Deyaar Development , Drake and Scull and Union Properties will join a separate small-cap MSCI benchmark.
So-called passive funds usually buy newly-added stocks or those with increased weightings on the last day before adjustments take effect. Egypt’s EFG Hermes has estimated combined passive fund inflows into the UAE and Qatar countries from the November adjustment at $1 billion.
Emaar Properties may also attract buyers after its shareholders approved on Monday a special cash dividend totalling 9 billion dirhams ($2.45 billion), related to the flotation earlier this year of a stake in Emaar Malls Group (EMG), the company’s malls and retail unit.
On global markets, Asian shares gave back some of their China-inspired gains on Tuesday, while oil prices stumbled as traders lowered their expectation of a significant output cut at this week’s OPEC meeting.-Reuters
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