Amid increased liquidity in Kuwait’s market, the Kuwaiti Stock Exchange rose 1.3 percent on Sunday, March 18, with trading volumes reaching the highest levels in several years. The KSE index closed at 1,459.4 points—its highest level since September. Although the index rose 8.3 percent on the year, it is still 48.5 percent down from its all-time high of November 1997.
Analysts stated that much of the trading was attributed to the Kuwait Petroleum Corp., mutual funds and other sources that led to a trading volume of $102 million—well above the $20 million average daily trading volumes of the past three years.
Investors have been focussed on selective buying of mostly “blue-chips” shares headed by the local commercial banks, a commercial facilities company, a mobile telecommunications company and others.
Increased optimism and investor confidence was also due to reports that the state-owned conglomerate Kuwait Petroleum Corp. planned to pump around $115 million into the emirate's bourse. Mutual funds have also been on the rise, increasing liquidity to the sinking market.
Last week, trading volumes surged to $55 million, rendering the bourse’s capitalization to approximately $23 billion, mainly due to the rise in prices of blue chips shares
Dealers also await the parliamentary approval on Tuesday of a foreign investment bill which opens the oil-rich emirate for foreign investors. The bill stipulates major incentives for foreign investors, including tax holidays and whole ownership of companies.
The KSE is comprised of roughly 87 companies, and has the second largest capitalization in the Arab world after Saudi Arabia's NCFEI index. — (Albawaba-MEBG)
© 2001 Mena Report (www.menareport.com)