MSX unveils investment initiatives

The Muscat Stock Exchange (MSX) has affirmed its commitment to stimulating the market and enhance the investment environment to attract more local and international investments, thereby contributing to the overall growth of the Omani economy.

Addressing the local media on Tuesday, February 11, 2025, Haitham al Salmi, CEO of the Muscat Stock Exchange, stated, “We are currently undergoing a crucial phase in the transformation of the Muscat Stock Exchange, transitioning from a government structure to a company owned by the Oman Investment Authority. This follows the restructuring of the Muscat Securities Market into the new Muscat Stock Exchange in 2021.”

He highlighted that one of the key objectives is to attract large-cap companies that align with global standards. The focus is on companies with a market capitalisation over RO 1 billion, as this is a necessary criterion for inclusion in global market indices.

He added that new electronic services will soon be introduced by brokerage firms, enabling investors to complete all trading transactions digitally—from account opening to financial transfers, payments, and receipts—directly through the online system. The exchange is also working on developing various projects, including a business model that brokerage firms can leverage to offer innovative services.

During the gathering, several initiatives and projects currently being implemented by the exchange were discussed, with a particular focus on attracting large-cap companies that meet global standards. Efforts are being made to enhance market liquidity by establishing liquidity stabilisation contracts with the ten largest listed companies. Additionally, a development fund has been set up to improve liquidity through government contributions.

Al Salmi emphasised that MSX has collaborated with other market exchange platforms to expand liquidity sources across different markets, including Abu Dhabi, Bahrain, and Kazakhstan. Agreements have also been signed with other markets such as Jordan, Egypt, Iraq, and Armenia. This network of multiple markets provides diverse liquidity options for investors.

Looking ahead, MSX will place particular focus on emerging markets such as Kazakhstan, presenting an opportunity to attract new investors. These exchange platforms have also facilitated the entry of foreign investors through local brokers.

Regarding liquidity, Al Salmi noted that discussions are underway with international market-making firms. He expects to see increased foreign capital inflows that will contribute to providing the necessary liquidity for local companies. Currently, there are three licensed market-making firms operating in Oman. While Omani companies play a crucial role in market development, the need for global expertise remains a challenge, necessitating the involvement of international firms to support liquidity and market growth.

On foreign investment, Al Salmi pointed out that in 2021, MSX reviewed foreign investment limits and announced an increase in the ceiling from 49 per cent to 100 per cent in some cases. This decision allows investors greater flexibility in selecting Omani companies to invest in, providing them with a broader range of opportunities. Through its strategies, MSX aims to open the market to as many companies as possible to attract foreign investments.

Bader al Hinai, Director of Operations at the Muscat Stock Exchange, stated, “We launched the first liquidity fund in 2024 in collaboration with Tanmia. This year, we are set to introduce two additional liquidity funds in partnership with locally licensed market-making firms. The primary objective of these funds is to enhance market liquidity and support the overall performance of the Omani exchange.”

Regarding recent fluctuations in stock prices, Al Hinai explained that supply and demand directly determine price movements. He noted that when there is high demand from buyers, prices increase, whereas if there is an excess of sellers, prices decrease. “Ultimately, the stock market is an open market where buyers and sellers meet, each determining a price they find suitable,” he added.

Al Hinai also mentioned that MSX is currently working on artificial intelligence (AI) projects aimed at improving services for investors and market participants. These projects specifically focus on enhancing disclosure processes and providing data transparency, which enables investors to make more informed decisions.