Oil-rich region shrugs off global downturn
While vicious headwinds originating from developed markets have cooled global equities this year, one of the world's hottest locations has withstood the storm.
'It seems as if it's the appropriate time to be looking at the Middle Eastern and North African [Mena] region,' said Rizal Wijono, managing director of SHK Fund Management. 'If you look at the markets in general, they are relatively uncorrelated with global markets.'
Most equity markets across the world have buckled this year as negative headlines suggested the global economy is headed for a slump. But the oil-rich Mena region has largely avoided the fuss.
The MSCI Arabian Markets Index has dropped 8.99 per cent so far this year to Thursday, but some of the loss can be attributed to profit-taking, given that the index surged 47.39 per cent last year. This compares to the MSCI World Index, which has slumped 14.13 per cent this year after gaining just 7.09 per cent last year.
And with stock indices in wealthy Persian Gulf countries like Oman and Qatar increasing 27.77 per cent and 22.82 per cent, respectively, so far this year to Wednesday, according to Bloomberg data, foreign investment interest in the region is increasing.
