Tadawul to have 2.3% weight on MSCI, if included

The Saudi stock market (Tadawul) will account for 2.3 percent weight of the MSCI’s Emerging Market Index, if included as expected by late 2018, the Index provider said in a recent report.

This estimated weighting would make the Saudi securities market the third largest among EMEA counterparts, behind South Africa (6.7 percent) and Russia (3.4 percent).

Saudi Arabia's market size is set to grow if Saudi Aramco decided to float part, on all, of its planned five percent stake locally, the index provider said. Aramco's IPO is slated for late 2018.

A decision on any upgrade and inclusion of Saudi stock market into MSCI will be made by next June, the index provider added.

Last June, the Saudi benchmark was added to a watch-list for possible inclusion in MSCI Emerging Markets index, after the country passed a series of market reforms, including easing foreign ownership requirements, reducing settlement cycles and introducing short-selling.