Kuwaiti stocks up one percent despite profit taking
The Kuwait Stock Exchange (KSE) withstood three days of profit taking to end the week Wednesday up 1.1 percent, buoyed by the market's new-found confidence, brokers said.
The KSE index closed at 1,448.4 points, 15.4 points higher than last week and 0.4 percent up on the end of 1999, but still a massive 48.9 percent lower than its all-time record high in November 1997.
"Trading began strong early in the week but eased on profit-taking. It is a healthy situation and the market appears very confident," one broker said.
Confidence levels, which dwindled in June and July, have been boosted by high oil prices, the settlement of billions of dollars of bad debt and the introduction of regulations allowing foreigners to own and trade on the bourse.
The regulations became effective Sunday after publication in the emirate's official gazette, but major foreign investors were still hesitant to enter the market because of some ambiguity over taxes.
Under a 1995 taxation law, foreign companies operating in Kuwait are required to pay up to 55 percent taxes on net profits. It was unclear if the law applies to portfolios trading on the KSE.
Average daily trading rose to 39.6 million dinars (130.7 million dollars), twice the value last week and some eight times higher than levels in June and July when the index hit a five-year low.
Some 87 companies with market capitalization of 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)