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The Saudi Exchange (Tadawul) has approved a request from SNB Capital to act as a market maker for MT30 Index Futures and single stock futures linked to five leading Saudi listed companies. The covered companies include oil giant Saudi Aramco, telecom operator stc, Saudi Arabian Mining Co. (Maaden), Saudi National Bank (SNB), and Al Rajhi Bank. Under this agreement, SNB Capital must provide continuous bid and ask quotes, ensuring specific requirements for order volume, depth, and duration are met.
This decision aims to significantly boost liquidity across the Saudi derivatives market, facilitating smoother transactions and tighter spreads. By creating a more efficient derivatives ecosystem, Tadawul seeks to attract a broader spectrum of institutional traders and risk-hedgers. The renewed market-making framework comes into effect following the structured termination of SNB Capital's prior agreement.
Overall, the enhancement of Tadawul's financial instruments aligns with Saudi Arabia's Vision 2030 objective to broaden capital market activity. Market participants should monitor whether increased derivatives liquidity triggers higher trading volumes in the underlying equity market, particularly across the prominent banking and industrial constituent stocks.
