News

Islamic indices outperform conventional market

Standard_and_PoorsThe majority of S&P and Dow Jones sharia-compliant benchmarks produced a better performance than conventional indices in the second quarter. The results of the S&P Shariah Indices and the Dow Jones Islamic Market (DJIM) Indices Scorecard Q2 2018 revealed that two key indices, the Dow Jones Islamic Market World and the S&P Global BMI Shariah, rose by 2.5% and 2.7% respectively, outperforming the mainstream S&P Global BMI by nearly two percentage points. In the US, the S&P 500 Shariah gained 4.1% in the first six months of 2018, in contrast to other regional benchmarks. The DJIM Europe, DJIM Asia-Pacific and DJIM Emerging Markets fell by 0.4%, 0.5% and 3.1% respectively in the same period. Middle Eastern equities similarly outperformed the market. While a strong US dollar, trade war concerns and rising interest rates have led to a sharp decline in emerging market equities, MENA stocks have benefitted from rising oil prices and strong investor confidence in Saudi Arabia, which was recently upgraded to emerging market status by two key index providers MSCI and FTSE Russell. A further index provider, S&P Dow Jones Indices (S&P DJI), also announced the upgrade of Saudi Arabia from standalone to emerging market status. Saudi stocks will be added to the index in two phases concurrent with the March 2019 quarterly rebalancing and September 2019 reconstitution, stated S&P DJI. ©2018 funds global mena

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