EME Strategy: Kuwait joins MSCI EM = USD 0.6bn outflows from EME
Yesterday (25 June), after the market closed, the MSCI announced the results of its Annual Market Review (AMR). In line with our predictions, the index provider decided to upgrade Kuwait from Frontier Markets (FM) to Emerging Markets (EM) along with the May 2020 Semi-Annual Index Review (SAIR). The upgrade depends on the availability of omnibus account structures and same National Investor Number (NIN) cross trades for international institutional investors by the end of November 2019, at the latest. This was declared by Kuwait's Capital Market Authority on 12 June 2019. The MSCI is due to announce its final decision by 31 December 2019. According to our estimates, the upgrade should result in c.USD 0.6bn of outflows from EME. The noted figure is, according to our estimates, about 10x smaller than our estimate of outflows from the region in 2019E related to other reclassification events, discussed in the following part of this flash note.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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