Trading Pattern for the month of October 2009

Published November 9th, 2009 - 01:56 GMT

The month of October witnessed a decrease in trading activity in the KSE. KSE observed a 21.4% decrease in trading value and 1.9% decrease in the number of traded shares on the back of a mild correction that occurred during the final week of October. Single day trading value in October reached as high as KD91.1mn and trading volume reaching as high as 448.8mn shares on October 7th, 2009. On a month to month basis, value traded decreased 21.4% in October to reach KD1,121mn from KD1,426mn witnessed in September. Investors completed 119,814 transactions as opposed to 105,223 in September, a 13.9% increase. The number of shares traded decreased 1.9% to reach 5.7bn shares.

Trading by Investor Type
Individuals continue to be the largest segment of traders in the stock exchange, as they accounted for 43.7% of the total value of shares bought and 46.9% of the total value of shares sold. Compared with previous month, total value of shares bought by individuals decreased 16.4% in October and total value of shares sold by individuals decreased 13.7%. Individuals in October bought shares valued at KD490.7mn and sold shares worth KD525.8mn, a net sell of KD35.1mn.

Table 01: Buying activity among type of investors (October.)
KD mn August September October % Growth
Individuals 920.5 586.7 490.7 -16.4%
Company/Establishment 495.1 417.9 318.6 -23.8%
Investment Funds 224.0 97.7 74.8 -23.4%
Client Accounts 657.5 324.6 237.6 -26.8%
Total 2,297.2 1,426.9 1,121.6 -21.4%
Source: Kuwait Stock Exchange

As for Companies and Establishments, they accounted for 28.4% of total shares bought and 25.4% of total shares sold. They bought shares valued at KD318.6mn while selling shares valued KD285.1mn, a net buy of KD33.4mn. Overall, buying activity of Companies and Establishments decreased by 23.8% in October, while selling activity decreased 26.8%. Companies and Establishments are net buyers for the seventh consecutive month.




Table 02: Selling activity among type of investors (October.)
KD mn August September October % Growth
Individuals 921.7 609.2 525.8 -13.7%
Company/Establishment 478.0 389.6 285.1 -26.8%
Investment Funds 212.2 116.8 75.5 -35.4%
Client Accounts 685.4 311.3 235.2 -24.4%
Total 2,297.2 1,426.9 1,121.6 -21.4%

Source: Kuwait Stock Exchange

As for Investment Funds and Client Accounts, they accounted for 6.7% and 21.2% respectively of total shares bought and 6.7% and 21.0% respectively of total shares sold in October. Investment funds were net sellers, buying shares valued at KD74.8mn and selling shares valued at KD75.5mn, a net sell of KD0.6mn. Investment Funds trading value is considered the lowest throughout 2009. As for Client Accounts, they acted as net buyers, although their buying activity in October decreased  by 26.8% and selling activity decreased by 24.4%. Client Accounts’ bought shares valued at KD237.6mn and sold shares valued at KD235.2mn, a net buy of KD2.4mn.

Table 03: Net Buying
KD mn August September October
Individuals (1.2) (22.5) (35.1)
Company/Establishment 17.2 28.3 33.4
Investment Funds 11.9 (19.1) (0.6)
Client Accounts (27.9) 13.3 2.4
Source: Kuwait Stock Exchange

Trading by Nationality Type
Kuwaitis were the biggest investor segment in the KSE for the month of October, accounted for 91.5% share of total shares bought. They became net sellers in October, buying shares worth KD1,026mn and selling shares worth KD1,041.9mn, a net sell of KD15.9mn. In October, Kuwaiti’s value of shares bought decreased 52.8% from KD1,338mn in September, while on the selling side their value decreased by 22% on a M-o-M basis.

Figure 01 :Shares of Nationalities in Value of Shares Bought (October.)                             Figure 02: Share of Nationalities in Value of Shares Sold (October.)







Source: Kuwait Stock Exchange                                               Source: Kuwait Stock Exchange

Their GCC counterparts’ share of the total value of shares bought increased to 3.0% from a previous 2.2% in September. Value of shares bought amounted to KD34.2mn as opposed to a selling value reaching KD32.1mn, a net buy of KD2.1mn. The value of shares bought and sold decreased by 40.9% and 24.9% respectively. The GCC segment were net buyer in October after three consecutive months of being net sellers.

Table 04: Net Buying
KD mn July August September
Kuwaiti 15.2 3.0 (15.9)
GCC (0.6) (11.1) 2.1
Others (14.6) 8.1 13.8
Source: Kuwait Stock Exchange

Other nationalities became net buyers in October, they bought 312mn shares valued at KD61.4mn and sold 257.5mn shares valued at KD47.5mn, a net buy of KD13.8mn.

The Kuwait Stock Exchange (KSE) lost 7.19% during the month of October 2009 as “Global” General Index ended the month at 203.70 points. This followed a loss of 2.36% in September-2009 while on a YTD basis the index return turned negative for the first time this year with a loss of 1.32%. The market capitalization reached KD32.9bn at the end of the month, registering a decline of 7.52% as compared to the previous month. Despite the surge in oil prices which close above US$81.00 on October 21, the KSE witnessed a declining trend for three consecutive weeks reaching its lowest level since May 25 as investors remain cautious regarding the third quarter results causing a sell-off spree.


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