Morgan Stanley Capital International (MSCI) Inc, a leading provider of global market indices, has added Oman International Bank (OIB) and Oman Cement Company to its frontier markets index.
MSCI said on its website on Wednesday that it has added four companies to the frontier markets index, while deleting 12 companies listed in different countries.
Along with OIB and Oman Cement, Arabtec of the UAE has also been added to the index as MSCI announced the results of its semi-annual review of global indices.
According to analysts, the inclusion of OIB and Oman Cement in the MSCI frontier markets index will provide a buying and liquidity trigger on these two counters as the foreign fund managers will be able to track these stocks through the MSCI index.
"Foreign fund managers who track MSCI index would be able to add OIB and OCC into their portfolios. Foreign fund managers do not focus on all the stocks in other markets and they follow indices like the MSCI.
"It's a positive development and it will attract more interest from foreign investors," said Sameer Kattiparambil, AVP of research at EFG-Hermes.
All of the changes to the MSCI indices will be implemented as of the close of May 31, 2012. Suresh Kumar, head of research at Al Maha Financial Services, said that the inclusion is definitely positive for the individual stocks as well as for the Oman market.
He said, "It also means that the Oman bourse's representation in the MSCI's frontier markets index is increasing which is a positive trigger for the market. These two companies are more likely to attract foreign buying interest and liquidity."
The MSCI frontier markets index provides a broad representation of the equity opportunity across 31 countries while taking investability requirements into consideration within each market.
© Muscat Daily 2012
