ADX replaces benchmark index with FTSE ADX General Index to streamline performance gauges

FTSE Russell and ADX plan to develop more indexes to help introduce tradable index products on the market

Abu Dhabi Securities Exchange has partnered with global index provider FTSE Russell to develop co-branded indices. Photo: Jeff Topping / The National

Abu Dhabi Securities Exchange, the best performing GCC bourse in 2021, has partnered with global index provider FTSE Russell to develop co-branded indices to bring its stock performance measures in line with global standards.

The FTSE ADX General Index is replacing the ADX General Index, and FTSE ADX sector indexes will take the place of the existing sector indexes. The move became effective on Monday, ADX said in a statement.

The co-branded indexes will support the development of the recently launched ADX derivatives market.

ADX launched its single stock futures in the fourth quarter of 2021 following an agreement sealed in September with the Nasdaq in September to deliver matching, real-time clearing and settlement technology as the Abu Dhabi exchange continues to broaden its asset class offerings to investors.

The Abu Dhabi bourse is the first exchange in the region to use FTSE Russell as its index administrator. The partners plan to develop new indexes that will support the ADX’s vision of introducing new tradable index products on the market.

“Our partnership with FTSE Russell is part of ADX’s wide-ranging strategy to develop a dynamic exchange, which includes investment in state-of-the art market technology and increasing the opportunity set for investors and issuers,” said Saeed Al Dhaheri, chief executive and managing director of the ADX.

“The new range of FTSE-ADX index will provide robust benchmarks and support the listing of index derivatives, ETFs [and] other index-based products on the exchange.”

ADX’s benchmark index crossed the 9,000-point threshold in 2021 for the first time. The benchmark gauge, which soared 64 per cent last year, is among the best performing in the world. The ADX market capitalisation has more than doubled to Dh1.6 trillion ($436 billion).

The bourse, which is home to the UAE’s largest telecoms company, Etisalat, and biggest bank, First Abu Dhabi Bank, has garnered the attention of foreign investors with foreign capital flows reaching Dh15.2bn last year, according to the statement.

ADX, the second-largest bourse in the Arab world by market value, saw several listings last year as the exchange continued to expand its portfolio of offerings.

Multiply Group, a subsidiary of Abu Dhabi's International Holding Company (IHC), listed its shares in December, making it the eighth IHC subsidiary to enter the emirate’s main market in less than a year.

In October, Fertiglobe, the world’s largest seaborne exporter of urea and ammonia combined, raised about $795 million from its listing on the ADX. That offering followed Adnoc Drilling, which reaped $1.1bn from its listing in the same month. In July, Yahsat, a unit of Mubadala Investment Company, raised about $730m through its listing.

“ADX is an innovative and vibrant marketplace that empowers the UAE’s economy. We are delighted to work together to strengthen the country’s capital markets with open access to data, pricing, and performance metrics,” said Arne Stall, chief executive at FTSE Russell.

“Our collaboration confirms FTSE Russell’s commitment to the Middle East region and we look forward to announcing a range of new benchmarks in the coming months.”