Saudi Arabian equities surged and continued strongly as investors reacted to potential foreign ownership reforms in listed companies. Moreover, regulators are considering allowing majority stakes for foreign investors, which could attract billions into the kingdom’s equity market. The surge in Saudi equities demonstrates growing confidence and optimism among local and international investors.
The Saudi Arabian benchmark index rose 1.1%, building on its largest single-day gain in over five years. Al Rajhi Bank, the world’s largest Islamic lender, surged more than 5% after marking a major gain in the previous session. Furthermore, Saudi National Bank climbed 4.4% to levels not seen for nearly eighteen months. Investors view these gains as signals of stronger market momentum.
Analysts predict that easing the 49% foreign ownership cap could trigger over $10 billion in foreign inflows. Consequently, MSCI may increase Saudi Arabia’s index weightings, raising demand and overall valuations. Daniel Takieddine, CEO of Sky Links Capital Group, explained that the reform enhances investor confidence and could attract additional long-term capital to the region.
Meanwhile, UAE markets rebounded after recent sell-offs. Dubai’s main index rose 0.3%, supported by a 1% gain in Emirates NBD Bank. Additionally, toll operator Salik increased 0.7%, while Tecom Group climbed more than 1%. Abu Dhabi’s index edged up 0.2%, buoyed by energy stocks such as ADNOC Drilling. AI-driven space tech firm Space42 rose 0.5% after signing a strategic deal with Japan’s Dynamic Map Platform.
Furthermore, the surge in Saudi equities highlights the kingdom’s rising appeal to foreign investors seeking opportunities in a stable and growing market. Firms across financial, energy, and technology sectors are expected to benefit from increased liquidity. Additionally, the potential reforms may encourage international partnerships, enhancing regional integration and capital inflows.
By contrast, Qatar’s stock index fell 0.4% to a more than two-month low. Industries Qatar dropped 1%, and Qatar Islamic Bank slipped 0.4%. This divergence underscores the unique optimism surrounding Saudi Arabia’s reforms and investor interest.
Finally, the surge in Saudi equities confirms that policy changes have a direct influence on market sentiment. Moreover, continued foreign interest indicates that Saudi Arabia may strengthen its position as the Gulf’s leading investment destination. Analysts believe that sustained gains are likely if the reforms proceed as planned, benefiting both investors and the broader economy.
