Mutlaq Al‑Ghowairi Contracting Co. postponed its IPO, stripping the Gulf of what would have been the region’s largest listing this year. The delay adds fresh pressure to Saudi Arabia’s Tadawul All‑Share Index, which has risen only about 5% YTD, lagging the MSCI global benchmark despite a windfall from higher oil prices. Investors now face another obstacle to market deepening for the kingdom.

Foreign investors have kept Saudi equities on the sidelines, leaving the market one of the most under‑weight positions in emerging‑market funds, per Bank of America. The portfolio tilt reflects a sector mix dominated by energy, petrochemicals and finance, with scant exposure to AI‑driven tech that fuels global EM rallies. Aberdeen’s Fraser Harle warns the index’s narrow base limits appeal for many allocators.

Saudi regulators have signaled a review of the 49% foreign‑ownership ceiling, a move that could unleash $10 billion of new capital. Even so, the Tadawul’s valuation premium over other EMs has slipped to roughly 20%, down from a decade‑average of 32%. With oil‑price tailwinds unevenly distributed, investors now focus on selective opportunities rather than broad market optimism.