Kuwaiti Stocks Peak at Year High on Foreign Ownership Law
The Kuwait Stock Exchange (KSE) rebounded strongly Wednesday to hit a record high for the year on the back of parliament's final approval of new legislation allowing foreigners to buy shares of listed firms.
The KSE index closed the week at 1,437.3 points, 3.7 percent up on the week, just down on the 1999 year-end closing price of 1442 points, but still 49.3 percent down on its all-time high in November 1997.
Kuwait's National Assembly gave its final nod Tuesday to a new law that allows foreigners to own up to 100 percent stocks of all listed firms on the KSE, in a move expected to help attract foreign capital and motivate a sluggish economy.
Commerce and Industry Abdel Wahab al-Wazzan Minister, who chairs the KSE committee, said the "law will facilitate the entry of foreign capital and expertise, as well as broadening the trading base on the bourse."
Ownership of Kuwaiti shares was limited to citizens and other Gulf Arab nationals, but foreigners could take part through mutual funds.
Earlier in the week the index shot through the 1,400-point mark for the first time in 11 weeks, and analysts were confident it would continue to rise.
"This increase has been expected for a long time. I think the index will continue to rise steadily and may go through the 1,500-mark by the end of the year," said Gerard Snabian, vice president of Al-Shall Economic Consultants.
Trading value and volume also rose to levels not seen in several months, and on Wednesday alone some 86 million shares worth 14.3 million dinar (46.9 million dollars) changed hands.
Share prices of 50 companies increased during trading Wednesday while only six of the remaining 35 firms saw their prices dropping. Other stocks remained unchanged.
Some 85 companies with a 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 – KUWAIT CITY (AFP).
© 2000 Al Bawaba (www.albawaba.com)