Franklin Templeton: Gulf stocks are a candidate for a greater role in the emerging market index

The company “Franklin Templeton” said that the representation of the shares listed on the Gulf stock exchanges within the market share index arises from the expectation that it will rise in about half due to the ‘deep shift’ in the region. Salah Shamma, head of Dubai -based Franklin Timbonton, said wave shares do not receive the attention that investors deserve, and that it is currently about 7% of MSCI emerging market index. He added during an interview that “the continuation of secondary offices and new public subscriptions” is expected to increase this weight to 10% during the next five years. The growth supported by development projects, the “Franklin” estimates are based on the expectation that growth in the region will get a strong boost thanks to the ambitious development projects in Saudi Arabia, and the plans of Qatar to expand the production of gas and economic reforms that do Kuwait. The Kingdom of Saudi Arabia and the United Arab Emirates are the favorite markets of Shamm in the region, because of the strength of the local consumption in it, which offers extensive investment opportunities in non -oil sectors. Expectations to increase foreign investment flow, Shamma said: “With the growing group of investment opportunities, we expect the flow of foreign investors to increase in weight and region, especially as foreign capital flow has already doubled to reach $ 60 billion over the past two years.” The MSCI index, which includes shares from the Gulf Cooperation Council countries, has risen 68% over the past five years, more than twice the performance of the broader emerging market index. Structural growth in the wave markets said that the region can see “periods of pressure, but that the story of structural growth is still strong.” He added that the wave markets “enjoy a strong and sustainable growth story compared to other emerging markets.” But in reality, there are challenges for this positive evaluation of the Saudi market, as foreign direct investment flow has decreased to the kingdom for the third year in 2024. Shama indicated that the decline in oil prices could push the Kingdom of Saudi Arabia to promote some projects within its development agenda, which could lead to postponing some of them. “However, we expect the most comprehensive investment program to remain within the Saudi Vision 2030 and are committed to the specified goals.”