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Nasdaq OMX (NASDAQ:NDAQ) Indexes is about to break into the already crowded field of index providers targeting Islamic investors.

Versions of the flagship Nasdaq 100 Index and Nasdaq Biotechnology Index are to be launched in the first quarter 2009.

Dow Jones, MSCI, FTSE Group and financial services firms including HSBC (HBC) and Citigroup (NYSE:C) have long lists of stock indexes, and to a more limited extent bond indexes, refashioned for the Islamic world.

Currently, there are six exchange-traded funds globally tracking Islamic indexes, according to Chicago-based data researcher Failaka.

Three are from Barclays Global Investors' European iShares ETF family based in London. The iShares track the MSCI Emerging Market Islamic, USA Islamic, and World Islamic equity indexes. BNP Paribas has an ETF based on the Dow Jones Islamic Titans Index, while Daiwa Securities launched an ETF based on a FTSE Sha'riah Japan 100 Japanese equity index.

As an exchange which a growing profile in the Middle East, Nasdaq has an immediate beachhead for its first Islamic indexes, in contrast to the stand-alone index providers.

Nasdaq recently rebranded the Dubai International Financial Exchange as Nasdaq Dubai, after purchasing a one-third stake in the exchange earlier in the year (see story here).

What's more, Dubai is the largest market in the world for structured products linked to Islamic law, according to Failaka.

Dubai is the largest part of an Islamic investing universe estimated at as much as $700 million globally. There are industry projections that it will grow to as much as $1 trillion in the next few years.

There has been a good deal of recent activity related to the Islamic indexes also.

Dow Jones recently released its first Islamic index for Southeast Asian equities, or the ASEAN counties (see story here).

Meanwhile, MSCI (MXB) recently added both emerging market and frontier market sha'riah compliant indexes (see story here).

Nasdaq expects that the indexes will serve as the basis for products from both local Gulf players and international asset managers, said John Jacobs, chief marketing officer at Nasdaq.

While the Dubai market may be the most obvious market in which to introduce the planned Islamic versions of the Nasdaq 100 and Nasdaq Biotechnology indexes, Nasdaq expects the indexes to be popular in Southeast Asia also.

"The most populace part of the Muslim world is Southeast Asia, and lots of firms want to bring out Sha'riah compliant index products there too," Jacobs said.

Source: Nasdaq To Debut Sha'riah-Compliant Indexes