Muscat – Oman has moved a step closer to joining the ranks of emerging markets, with global index provider FTSE Russell adding the sultanate to its Watch List for possible reclassification from Frontier Market to Secondary Emerging Market status.

The announcement came on Wednesday as part of FTSE Russell’s annual country classification review for September 2026, which covers countries tracked by its global equity and fixed income indices.

FTSE Russell, part of the London Stock Exchange Group (LSEG), said Oman is currently classified as a Frontier Market but already meets the FTSE Quality of Markets criteria, as well as the minimum size and securities-count requirements for Secondary Emerging Market status.

“FTSE Russell is pleased to announce that Oman is being added to the Watch List for possible reclassification from Frontier to Secondary Emerging market status,” the index provider said.

Haitham al Salmi, Chief Executive Officer of the Muscat Stock Exchange (MSX), welcomed the decision in a post on LinkedIn, calling it “a proud moment for Oman’s financial sector and a promising opportunity for investors”.

He said the milestone reflects Oman’s progress in strengthening its capital markets, meeting FTSE Russell’s Quality of Markets criteria and achieving the scale required for global index inclusion.

“Reclassification would mark a turning point – enhancing investor confidence, attracting foreign capital, and reinforcing Oman’s role in the GCC’s evolving financial landscape,” Al Salmi said.

Vietnam and Greece were reclassified to Secondary Emerging and Developed market status, respectively, in the same review by FTSE Russell. “As peers like Vietnam advance to Secondary Emerging and Greece to Developed status, Oman’s inclusion signals that the sultanate is on the right trajectory towards deeper integration with global markets,” Al Salmi said.

He added that the MSX will continue engaging with all stakeholders to complete the upgrade and fully realise the benefits of FTSE inclusion, and extended his gratitude to all stakeholders whose dedication and collaboration made the achievement possible.

The development follows a strong run for Omani equities in 2025 and so far this year. Last year, the MSX emerged as the best-performing equity market in the Gulf and one of the strongest globally in 2025, delivering a robust annual gain of 28.2%.

In 2026, the benchmark MSX30 Index has risen 33.4% so far this year, with the exchange continuing to be the best-performing GCC market.

Market activity has expanded sharply. The total value traded on the MSX jumped 325.9% to nearly RO5bn in 2025, compared with RO1.2bn in 2024. The pace has accelerated in 2026, with average daily trading value reaching about RO53.3mn year-to-date, more than 161% above last year’s average of RO20.4mn.

Total market capitalisation of the MSX has risen to nearly RO40bn, a 25% increase from end-2025, when market cap stood at RO32bn.

Closely watched by investors

Inclusion on the FTSE Russell Watch List is not an upgrade in itself. It signals that the Omani market has met the necessary thresholds and is under formal consideration for reclassification, with any final decision to be announced in a future review. FTSE Russell said its next update will be published in April 2027.

The move is nonetheless closely watched by investors because index classification can shape how global funds allocate capital. Emerging market indices are tracked by far larger pools of passive and active money than frontier benchmarks, and a market’s inclusion can bring greater visibility and potentially wider foreign participation. Around $20tn is benchmarked to FTSE Russell indexes, according to the company, which calculates indexes covering markets in more than 70 countries.

Brokerage firm Ubhar Capital had earlier noted that a potential upgrade of the MSX from frontier to emerging market status by global index providers such as MSCI and FTSE would be a key milestone for Oman’s capital market. Such an upgrade, combined with a strengthening IPO pipeline and rising merger and acquisition activity, is expected to support higher trading volumes and further improve price discovery across the exchange.

The Muscat Stock Exchange has entered a new phase of development as improvements in liquidity, accessibility, investibility and market infrastructure bring the exchange close to the standards associated with emerging market status. Over the past few years, the exchange has worked to meet by 2026 the criteria for emerging market status set by MSCI and FTSE Russell, with an aim to secure inclusion in the indexes by 2027 or 2028.