Kuwaiti stocks buoyant on renewed confidence
The Kuwait Stock Exchange (KSE) closed the week Wednesday two percent up for the second week running, as the market continued to buck the traditional summer trading lull on government pledges to initiate reforms.
The KSE index closed at 1,408.8 points, over the 1,400-point barrier for the first time in seven weeks, but still 2.3 percent lower than the end of 1999 and 50.3 percent down on the index's all-time high in November 1997.
The index gained 37.4 points in August, a month when trading is traditionally very slow. The rise was buoyed by the government's introduction of legislation allowing foreigners to trade on the bourse and promises to press economic reforms.
"My old customers who disappeared because of the decline in 1998 and 1999 have returned. They made some orders to buy shares," one broker said.
Last week, the KSE rose 2.2 percent on the back of the government's nod to regulations of a bill allowing foreign ownership of Kuwaiti stocks.
The bill allows foreign investors and expatriates living in Kuwait to own up to 100 percent of the stock of Kuwaiti companies listed on the stock exchange other than banks, where ownership will be limited to 49 percent.
Ownership in banks could still exceed that percentage if approval is granted by the cabinet on the recommendation of the central bank.
Confidence was strengthened after the government approved on August 27 amendments to the 1960 Commercial Law, stipulating more transparency on the bourse and introducing penalties for leaking insider information.
Analysts, however, still fear that political wrangling may negatively affect the resurgent bourse.
Some 87 companies with market capitalization of about 20 billion dollars are listed on the KSE, the second largest bourse in the Arab world after the NCFEI in Saudi Arabia.
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)