DUBAI: Bank of America Merrill Lynch raised its assessment of Qatar's stock market to overweight from neutral, and cut the United Arab Emirates to neutral from overweight, according to a BofA Merrill Lynch Global Research report seen on Thursday.
The investment bank cited Qatar's surprise upgrade to emerging market status by Morgan Stanley Capital International, announced on Tuesday, which it said could attract $600 million of index-linked funds to Qatar.
It also cited attractive stock valuations.
MSCI-related fund flows to the UAE will be smaller while it is already fully valued after this year's strong performance, it said.
BofA Merrill also reiterated that it saw Saudi Arabia as a preferred market, and kept an overweight rating on Turkey, though it said this was "conditional on an uneventful end to the protests" in Turkey.
"Crucially, even with somewhat higher interest rates than today, Turkey remains a country that can see accelerating growth in 2013 and 2014 without needing an improvement in the global economic backdrop," it said. (Reuters)
