18 November 2007
KUWAIT: Kuwaiti Stock Exchange (KSE) retreated further for the fifth week reaching its lowest level since June 13, 2007). "Global" General Index shed another 0.70 percent this week closing at 377.80 points. The index's overall YTD gain dropped to 29.93 percent. On the other side, Kuwait Stock Exchange (KSE) Price Index closed at 12,483.90 points, 0.97 percent down from last weeks' closing. Market breadth skewed towards declining stocks with 94 decliners against 44 advancers while 21 stocks were not traded.
Trading activity rose this week as investors started to take their positions with the corporate results period coming to an end. Volume of shares traded on the bourse increased by 8.58 percent, with 1.35 billion shares exchanged. Value of shares traded also rose by 19.55 percent, aggregating to KD616.20 million. Investment sector accounted for 36.85 percent of the volume traded this week with 496.33 million shares changing hands. The same sector also came on top of the value list with KD178.15 million, accounting for 28.91 percent of the total traded value.
Global Services Index was the biggest gainer and managed to end the week with 0.21 percent increase. Two services companies made it to the top gainers list this week. Automated Systems Company's share price increased by 6.06 percent while Safat TEC Holding's share price rose by 5.81 percent. Global Insurance Index was the only other gainer for the week, adding 0.17 percent. All other sectors showed negative performance. Global Investment Index was the biggest loser, shedding 1.88 percent this week. Global Real Estate Index came second, shedding 1.76 percent. The index was dragged down by 22 real estate stocks ending the week with negative performance.
Global special indices ended the week with negative performance as well. Global Large Cap (Top 10) Index retreated by 0.19 percent, while Global Small Cap (Low 10) Index dropped by 2.48 percent from its previous weeks' close. The Sharia compliant, Global Islamic Index was seen down by 1.88 percent.
National International Company (Holding) was the biggest gainer this week, adding 10.53 percent with 1.21 million shares changing hands. On the other side, Mubarrad Transport Company was the biggest loser, shedding 13.83 percent. Iraq Holding Company was the most traded stock for the week with 111.84 million shares changing hands, accounted for 8.30 percent of the total traded volume. The scrip closed 5.45 percent down at KD0.052.
Macroeconomic environment
Annual inflation in Kuwait eased to 4.81 percent in August from a near 12-year high of 4.98 percent recorded a month earlier. Kuwait broke ranks with fellow Gulf Arab oil producers in May and dropped its currency peg to the tumbling Dollar to contain inflation by reducing the cost of imports, a third of which it pays for in Euros. Kuwait's All Items Consumer Price Index fell 0.25 percent from July. The same index is up by 4.81 percent since August 2006.
Kuwait's annual inflation rate would be 2.6 percent this year, down from 2.8 percent last year, the lowest in the Gulf Arab region, according to an IMF report. (Source: Reuters & Arab Times) A representative of Kuwait's Chamber of Commerce and Industry (KCCI) said that Kuwait desires to expand its economic and trade relations with the European Union.
Kuwait's trade with the EU exceeded $50 billion in the last five years, said Saleh Fahad Al-Marzouk, financial manager of the KCCI. He added that KCCI is looking forward to increase that figure because there are lots of projects that can be done between the two sides. Among the projects to be built in Kuwait in the near future, he listed the establishment of a new port in Boubyan Island and upgrading Shuwaikh and Shuaiba Ports. Kuwait exported goods and services estimated in 2006 at $57.2 billion which includes $53.2 billion worth of oil. Total imports of goods and services in Kuwait are estimated at $24 billion in 2006.
The price of Kuwaiti crude oil retreated to $85.96 per barrel on Monday, November 12, a drop of $0.73 from last Friday's (November 9) price of $86.69 per barrel, according to Kuwait Petroleum Corporation (KPC). The Kuwaiti crude has seen record highs last week amid anticipation among experts that it would break the $85 mark, which happened on Wednesday, November 7, 2007 as the oil was traded for $87.7 per barrel, the highest price seen so far. International oil prices are still at record highs above the $95/barrel-mark.
Kuwait National Petroleum Company (KNPC) said that it was continuing its project to establish the nation's fourth refinery in accordance with the approval plan. KNPC's Chairman and Managing Director Farouq Al-Zanki said that the firm had recently held a preparatory meeting for establishing the refinery with qualifies international contractors. The project's tender was presented on October 7 with a deadline for all bids was set at December 16, 2007. The new refinery will produce environment friendly fuel to be utilized at Kuwait's electricity and water plants. Expected to begin operations during 2011, the refinery will have the capacity of 165,000 barrels-per day.
Other local news
An official at the Ministry of Communications said that an independent telecommunication authority could be established within eight months. He stated that before the third telecom provider starts its official operation, regulations and laws to protect all operators and consumers will be in place, said Abdul Aziz Al-Osaimi, Undersecretary Minister of Communications. He expected that the regulatory authority for telecommunication will be established within eight months to one year.
Global Investment House has come out with its monthly GCC Market Review - November 2007. GCC stock markets witnessed strong growth on the back of increased buying interest by the retail as well as institutional investors. The strong rally in the region can be seen from the fact that four out of the six regional indices recorded double digit gains during the month, led by UAE which recorded a whopping monthly growth of 20.2 percent in October 2007. Kuwait market bucked the trend as it ended the month in red, down 1.6 percent. As a result of this late rally in the region, all the markets are showing positive YTD growth with Omani index leading the way with the YTD growth of 43.7 percent. Although the long-term trend of the markets look positive, we might see some profit-booking in select counters.
An auction will be held on November 20, 2007 for the sale of 44mn shares of the Nibras Holding Company , which represents 88 percent of the company's capital, at an initial price of 470fils per share and a total value of KD20.68 million. An agreement was reached between Global Investment House and Al-Madina Finance and Investment Company to act as vendor and as principal buyer respectively. As the agreement between the above buyer and seller is preliminary, other bidders are also invited to make their bids.
Global Investment House Jordan (Global-Jordan) announced that it has successfully closed the public placement for Model Restaurants Company at JD380 million, making it one of the largest public offerings in the Jordanian Stock Market. The public placement offered JD6.25 million, which is equivalent to 25 percent of the company's paid-up capital while 75 percent of the capital valued JD18.75 million was covered in full by the founders of the company. The placement was oversubscribed by 60 times.
Al-Argan International Real Estate Company announced that it has recently acquired membership in the US Green Buildings Commission, becoming the first national company to get this membership. Mohammad Al-Saqqaf, the company's Deputy Chairperson and Chief Executive Officer, said that the Al-Argan took part in an international conference that was recently organized by the commission in Chicago, with attendance of former US president Bill Clinton and that the company is keen on taking part in such international events as part of its efforts to construct buildings that are friendly to the environment.
KUWAIT: Kuwaiti Stock Exchange (KSE) retreated further for the fifth week reaching its lowest level since June 13, 2007). "Global" General Index shed another 0.70 percent this week closing at 377.80 points. The index's overall YTD gain dropped to 29.93 percent. On the other side, Kuwait Stock Exchange (KSE) Price Index closed at 12,483.90 points, 0.97 percent down from last weeks' closing. Market breadth skewed towards declining stocks with 94 decliners against 44 advancers while 21 stocks were not traded.
Trading activity rose this week as investors started to take their positions with the corporate results period coming to an end. Volume of shares traded on the bourse increased by 8.58 percent, with 1.35 billion shares exchanged. Value of shares traded also rose by 19.55 percent, aggregating to KD616.20 million. Investment sector accounted for 36.85 percent of the volume traded this week with 496.33 million shares changing hands. The same sector also came on top of the value list with KD178.15 million, accounting for 28.91 percent of the total traded value.
Global Services Index was the biggest gainer and managed to end the week with 0.21 percent increase. Two services companies made it to the top gainers list this week. Automated Systems Company's share price increased by 6.06 percent while Safat TEC Holding's share price rose by 5.81 percent. Global Insurance Index was the only other gainer for the week, adding 0.17 percent. All other sectors showed negative performance. Global Investment Index was the biggest loser, shedding 1.88 percent this week. Global Real Estate Index came second, shedding 1.76 percent. The index was dragged down by 22 real estate stocks ending the week with negative performance.
Global special indices ended the week with negative performance as well. Global Large Cap (Top 10) Index retreated by 0.19 percent, while Global Small Cap (Low 10) Index dropped by 2.48 percent from its previous weeks' close. The Sharia compliant, Global Islamic Index was seen down by 1.88 percent.
National International Company (Holding) was the biggest gainer this week, adding 10.53 percent with 1.21 million shares changing hands. On the other side, Mubarrad Transport Company was the biggest loser, shedding 13.83 percent. Iraq Holding Company was the most traded stock for the week with 111.84 million shares changing hands, accounted for 8.30 percent of the total traded volume. The scrip closed 5.45 percent down at KD0.052.
Macroeconomic environment
Annual inflation in Kuwait eased to 4.81 percent in August from a near 12-year high of 4.98 percent recorded a month earlier. Kuwait broke ranks with fellow Gulf Arab oil producers in May and dropped its currency peg to the tumbling Dollar to contain inflation by reducing the cost of imports, a third of which it pays for in Euros. Kuwait's All Items Consumer Price Index fell 0.25 percent from July. The same index is up by 4.81 percent since August 2006.
Kuwait's annual inflation rate would be 2.6 percent this year, down from 2.8 percent last year, the lowest in the Gulf Arab region, according to an IMF report. (Source: Reuters & Arab Times) A representative of Kuwait's Chamber of Commerce and Industry (KCCI) said that Kuwait desires to expand its economic and trade relations with the European Union.
Kuwait's trade with the EU exceeded $50 billion in the last five years, said Saleh Fahad Al-Marzouk, financial manager of the KCCI. He added that KCCI is looking forward to increase that figure because there are lots of projects that can be done between the two sides. Among the projects to be built in Kuwait in the near future, he listed the establishment of a new port in Boubyan Island and upgrading Shuwaikh and Shuaiba Ports. Kuwait exported goods and services estimated in 2006 at $57.2 billion which includes $53.2 billion worth of oil. Total imports of goods and services in Kuwait are estimated at $24 billion in 2006.
The price of Kuwaiti crude oil retreated to $85.96 per barrel on Monday, November 12, a drop of $0.73 from last Friday's (November 9) price of $86.69 per barrel, according to Kuwait Petroleum Corporation (KPC). The Kuwaiti crude has seen record highs last week amid anticipation among experts that it would break the $85 mark, which happened on Wednesday, November 7, 2007 as the oil was traded for $87.7 per barrel, the highest price seen so far. International oil prices are still at record highs above the $95/barrel-mark.
Kuwait National Petroleum Company (KNPC) said that it was continuing its project to establish the nation's fourth refinery in accordance with the approval plan. KNPC's Chairman and Managing Director Farouq Al-Zanki said that the firm had recently held a preparatory meeting for establishing the refinery with qualifies international contractors. The project's tender was presented on October 7 with a deadline for all bids was set at December 16, 2007. The new refinery will produce environment friendly fuel to be utilized at Kuwait's electricity and water plants. Expected to begin operations during 2011, the refinery will have the capacity of 165,000 barrels-per day.
Other local news
An official at the Ministry of Communications said that an independent telecommunication authority could be established within eight months. He stated that before the third telecom provider starts its official operation, regulations and laws to protect all operators and consumers will be in place, said Abdul Aziz Al-Osaimi, Undersecretary Minister of Communications. He expected that the regulatory authority for telecommunication will be established within eight months to one year.
Global Investment House has come out with its monthly GCC Market Review - November 2007. GCC stock markets witnessed strong growth on the back of increased buying interest by the retail as well as institutional investors. The strong rally in the region can be seen from the fact that four out of the six regional indices recorded double digit gains during the month, led by UAE which recorded a whopping monthly growth of 20.2 percent in October 2007. Kuwait market bucked the trend as it ended the month in red, down 1.6 percent. As a result of this late rally in the region, all the markets are showing positive YTD growth with Omani index leading the way with the YTD growth of 43.7 percent. Although the long-term trend of the markets look positive, we might see some profit-booking in select counters.
An auction will be held on November 20, 2007 for the sale of 44mn shares of the Nibras Holding Company , which represents 88 percent of the company's capital, at an initial price of 470fils per share and a total value of KD20.68 million. An agreement was reached between Global Investment House and Al-Madina Finance and Investment Company to act as vendor and as principal buyer respectively. As the agreement between the above buyer and seller is preliminary, other bidders are also invited to make their bids.
Global Investment House Jordan (Global-Jordan) announced that it has successfully closed the public placement for Model Restaurants Company at JD380 million, making it one of the largest public offerings in the Jordanian Stock Market. The public placement offered JD6.25 million, which is equivalent to 25 percent of the company's paid-up capital while 75 percent of the capital valued JD18.75 million was covered in full by the founders of the company. The placement was oversubscribed by 60 times.
Al-Argan International Real Estate Company announced that it has recently acquired membership in the US Green Buildings Commission, becoming the first national company to get this membership. Mohammad Al-Saqqaf, the company's Deputy Chairperson and Chief Executive Officer, said that the Al-Argan took part in an international conference that was recently organized by the commission in Chicago, with attendance of former US president Bill Clinton and that the company is keen on taking part in such international events as part of its efforts to construct buildings that are friendly to the environment.
© Kuwait Times 2007
