Tadawul ‘most active’ GCC stock market in 2018: PwC

Saudi Stock Exchange (Tadawul) was the most active GCC stock exchange last year, raising $1.2 billion, PwC said in a report on Monday.

In its "GCC Capital Markets Watch", the consultancy said: "Tadawul remained the most active exchange by number of initial public offerings (IPOs) and the Kuwaiti stock exchange performed strongly in terms of investment returns – possibly helped by its inclusion in the FTSE Russell Emerging Market Index from September 2018."

Tadawul saw the listing of three IPOs in Q4 2018, the highest among the GCC, followed by one each in Bahrain and Qatar.

"The equity markets remained active in 2018, although showed declining statistics in terms of primary IPOs compared to 2017. Q4 was a noticeable quarter for 2018 but still some way behind the eight IPOs in the last quarter of 2017, which generated $2.46 billion," PwC said.

While the GCC IPO outlook for 2019 hinges on the oil price and geopolitical climate, the consultancy said that there was a "cautious" investor sentiment which is expected to “linger in the early months of 2019.”

Meanwhile, Saudi Arabia issued $14.2 billion of sovereign bonds last year, the highest in the GCC. 

Despite the increasing Federal interest rate, fluctuating oil prices and global economic downturns, the GCC bond market has shown commendable performance, PwC said, adding it delivered stronger risk-adjusted returns than many other traditional bond markets since 2013.

"The decision to include GCC nations in JP Morgan’s Emerging Market Bond Index from January 2019 and the ascending tendency of oil prices were likely to have contributed to the overall GCC performance and boosted the issuance of GCC debts in 2018," the consultancy said.