WOOD Flash – EME Strategy: Argentina and Saudi Arabia in EM = USD 3bn outflows from EME
On 20 June, the MSCI announced that it will include Saudi Arabia and Argentina in the MSCI Emerging Markets index (MSCI EM). The Saudi Arabia addition will be split into two stages: 1) following the May 2019 Semi-Annual Index Review (SAIR); and 2) following the August 2019 Quarterly Index Review (QIR). Argentina will be added to the index, following the May SAIR 2019, in a single stage. However, the MSCI noted that it might review its decision over Argentina’s inclusion if the country introduces any kind of capital or foreign exchange controls. We have decided to present our estimates of potential fund outflows triggered by the two events. Overall, we estimate that the inclusions could result in c.USD 0.7bn of passive and c.USD 2.3bn of active outflows from EME. We note that the estimates below do not include the potential impact of Saudi Aramco’s inclusion in the MSCI EM index (if the IPO happens, and if the stock is added to the index). We have, however, presented a detailed analysis of this case in our recent report (EME Strategy_MSCI Annual Market Reclassification_15Jun2018.pdf).
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.