Nasdaq Dubai names 12 firms with $229bn market capitalisation for Saudi futures

These companies account for 43% of the total market value of the Saudi stock exchange

By listing these futures, Nasdaq Dubai will provide investors with “new hedging and leverage tools that support their ability to play an active role in the Saudi equity market,” Hamed Ali. Satish KumaShow more

Nasdaq Dubai named on Tuesday 12 Saudi listed companies, with a combined market value of 859 billion Saudi riyals (Dh841.3bn), for which it plans to launch futures as the bourse expands its offerings beyond UAE stocks.

The companies, some of them among the largest businesses in the Middle East, are active in sectors from real estate and petrochemicals to banking and transport, Nasdaq Dubai said in a statement . These companies account for 43 per cent of the Saudi stock exchange, or Tadawul, as the largest Arab equities market is known, it added.

By listing these futures, Nasdaq Dubai will provide investors with “new hedging and leverage tools that support their ability to play an active role in the Saudi equity market,” said Hamed Ali, chief executive of Nasdaq Dubai. “The launch of these products in Dubai reflects the growing synergies between the capital markets of the GCC.”

Nasdaq Dubai launched UAE futures trading in September 2016 as it seeks to diversify its product offerings. Last year, the bourse added futures linked to the Dubai Financial Market’s benchmark share index as well as futures linked to the Abu Dhabi Securities Exchange’s main gauge that are traded on Nasdaq Dubai’s derivatives platform.

The framework built for trading and clearing Saudi futures is based on intensive consultations with regional and international market participants including brokers and potential investors, Nasdaq Dubai said in May when it first announced the launch of Saudi futures.

The twelve Saudi companies selected by Nasdaq Dubai are:

Saudi Basic Industries Corporation, the biggest petrochemical firm in the Mena region; Al Rajhi Bank, the biggest listed lender on Tadawul; Alinma Bank; Almarai, the Arabian Gulf’s largest dairy producer; Dar Al Arkan; Etihad Etisalat, a unit of UAE’s biggest telecom operator Etisalat; Rabigh Refining and Petrochemical Company; Saudi Arabian Mining Company, the largest miner in the Arab world; Saudi Cement; Saudi Electricity; Saudi Kayan Petrochemical; and Altayyar Travel Group.

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The Saudi futures will begin trading on the Dubai International Financial Centre-based exchange in September, it said without specifying the date. The single stock futures will be traded on Nasdaq Dubai in Saudi riyals, which is the currency of the underlying shares.

The Tadawul All Share Index, the benchmark Saudi equities gauge has risen 15 per cent so far this year. The trading value on the exchange has climbed to 475bn riyals, up 9 per cent from the same period in 2017. Global index compiler MSCI and its rival FTSE Russell, earlier this year upgraded Saudi Arabia to emerging market status.