Capital inflows into markets in the Middle East and North Africa (MENA) reached $655m during May, according to date from Deutsche Bank, marking the biggest monthly flow of capital into the region in five years.
The report found that on an aggregate basis MENA markets recorded around $2bn since the start of this year, compared to an outflow of $192m during the same period in 2012.
Out of the $655m that poured into the region last month, Saudi Arabia’s bourse accounted for $308m, followed by Qatar and Dubai with $131m and $129m, respectively.
"MENA markets continue to impress with their solid performance. Dubai has advanced by more than 47 percent year to date, followed by Abu Dhabi at 39 percent and Kuwait 35 percent,” commented Aleksandar Stojanovski, research analyst at Deutsche Bank.
“The recent upgrade in the Emerging Market index of the United Arab Emirates and Qatar reflects the confidence of international investors and will further leverage the regions visibility to represent a potential $400m to $450m of incremental funds inflows for each country."
Since the start of this year Dubai’s bourse has rallied by more than 45 percent, Abu Dhabi 36.5 percent and Qatar 14 percent.
Markets in the UAE and Qatar jumped last week on equities index MSCI’s upgrade of these countries to emerging markets status. The decision could see $430m of new investment flow into Qatar, and $370m into the UAE.