Boursa Kuwait needs major deals to restore confidence
The Boursa Kuwait, formerly Kuwait Stock Exchange, is in a dire need for big deals to restore confidence to the market amid eroding confidence, two Kuwaiti economists said yesterday. Speaking to KUNA, they said that the bourse faced several problems that lead to a reluctance of market makers. This affected negatively the confidence of dealers and the deals do not return the needed incentives to the market, they added.
The Boursa Kuwait has been facing a continued retreat in terms of value and deals since the beginning of this year, Salah Al-Sultan, adviser at Arzak Capital Investment Company, said. He added that transactions of Kuwait Food Company (Americana) helped the market regain some confidence. The bourse depends mainly on individuals not on institutional investment, he noted. He called on the concerned bodies to discuss and address the causes leading to the drop in general performance in order to revive the economy.
Meanwhile, Chairman and CEO of Al-Riyada Finance and Investment Co Mohannad Al-Sanea said the bourse is thirsty for such bargains to give confidence to dealers. There are a number of operating companies which have many attractive investment activities internally and externally, he added. Earlier in the day, benchmark of Boursa Kuwait ended trading in the red zone. The price index was down 18.85 points to stand at 5,309 points, the weighted index was also down 1.42 points and the KSX 15 index fell by 1.22 points. Value of trade was at KD 5 million while the volume was 53.9 million shares done through 1,582 deals.
Meanwhile, the performance of banking shares weighed on Saudi Arabia’s market index yesterday after the largest listed bank reported profits below analysts’ expectations, while indexes for other markets in the region also fell. Riyadh’s index fell 1.1 percent as National Commercial Bank (NCB) tumbled 5.6 percent after reporting a third-quarter net profit of 1.96 billion riyals ($523 million), down 1.6 percent from the same period of 2015. Three analysts had on average forecast a quarterly profit of 2.31 billion riyals. NCB, like most other Saudi banks that have already reported quarterly results, cited higher costs, including a rise in impairments on financings and investments. The bank is a key lender to Saudi Arabia’s troubled construction sector.