KUWAIT CITY: The bourse slipped further on Monday, as most of the blue chips sagged amid weak sentiments. The market dropped 29.7 points in choppy trading led by Zain and Wataniya Telecom Co, extending the losses to the third consecutive session. Zain edged 2.5 percent lower and the other telecom service provider dived over 7 percent after posting steep decline on Sunday. The bourse had closed lower in all except one in past eight sessions as investors remain skeptical about the impact of the governments rescue plan announced last week.
Banking stocks closed mostly in the red. National Bank of Kuwait dropped 20 fils after stagnating in the previous session while Al Ahli Bank shed 40 fils. Bank of Kuwait and Middle East took in 10 fils while Burgan Bank and Kuwait Finance House did not budge from their previous close. KIPCO was up 5 fils and Investment Dar was not traded during the day. Global Investment House fell 5 fils and National Industries Group lost 15 fils. NIG had eroded over 10 percent in January and but has climbed almost 23 percent so far during the month. Agility edged 10 fils lower during the day. KSE index fell 0.4 percent to 6576.4 points amid a slight decrease in volume turnover.
Slipped
The market markedly negative during the month. After witnessing moderate recovery in the first week, the index succumbed to sustained profit booking. The investors remains cautious of the market direction and are awaiting strong cues before making any decision to take fresh positions. The bourse has slid 13.5 percent since the start of the year, as slew of factors including the poor quarterly earning results and bleak prospects of growth in the immediate future. Weighted index fell 4.95 points to 344.09 points and has slipped 4.5 points since the start of the month.
The sectoral indices mostly sagged during the session. Banking sector dropped 1.5 percent led by National Bank of Kuwait and Al Ahli Bank and investment sector slipped 5 percent weighed by National Investment Co and marginal losses in most of the large caps. The two sectors make for the bulk of the shares traded in the bourse.
Real estate was stagnant and none of the insurance sector shares too were traded during the session. Industrials climbed 0.4 percent helped by Kuwait Cement Co and Mena Holding Co.
Zain and Wataniya Telecom pulled the services sector down by 0.5 percent while food sector eroded 0.8 percent dragged by Kuwait Food Co (Americana). Non-Kuwaiti sector shed 1.2 percent led by moderate losses by United Gulf Bank.
In the bourse related news, Bank of Bahrain and Kuwait has made net profit of KD 20.96 and the earning per share was 26 fils. The board of directors have declared a cash dividend of 20 percent of the share's nominal value. Mena Holding Company has commenced the private subscription to capital increase by issuing 299.9 million shares representing the 100 percent of the existing shares. The shares will be issued at value of 100 fils plus 200 fils premium per share. International Leasing and Investment Company signed an official contract with Bank of Kuwait and Middle East to receive financing facilities worth KD 20 million (in cash) from the bank. Under the agreement the bank will reschedule KD 60 million for a duration of 18 months.
Global sold 15.19 million shares in Palestine Real Estate Investment Co, also known as Aqaria, for 800 Jordanian fils each, it said in a statement on the Bahrain bourse website. That transaction is worth 12.15 million Jordanian dinars ($17.15 million). Global said last month it had defaulted on most of its debts as the company battles with the credit crunch. Global had said last week that it had reached an agreement with Jordan's Housing Bank for Trade and Finance to release bank deposits seized by a court over a $13 million loan dispute.
Surged
The volume of shares fell 0.6 percent to 254.2 million. The market liquidity surged to 483.6 million on Wednesday, the highest level so far during the month as investor chased value shares after the announcement of the latest government's rescue package worth KD 1.5 billion. However it tapered in the following sessions.
Banking sector dived 63 percent while the investment sector surged 43 percent in volume led by brisk trading in Ektitab Holding Co. Real estate shrank 12.6 percent whereas industrials rose 8 percent on back of National Industries Group.
Services sector was 7 percent in volume while food sector dropped 21 percent. Non-Kuwaiti sector slid 28 percent in volume turnover.
Commercial Bank of Kuwait posted a net loss of about 4.17 million dinars ($14.31 million) in the fourth-quarter. The full-year profit fell 16.3 percent to KD 100.73 million , or 80.6 fils per share, from KD 120.36 million, or 95.1 fils per share, in the previous year. The lender had said last year that it is planning to hike its stake in Syrian Cham Bank to 30 percent and also was in talks to buy 70 percent of Yemen Gulf Bank. Total assets rose slightly to KD 4.31 billion in 2008 as compared with KD 4.29 billion in 2007, while shareholders' equity fell to KD 497.37 million from KD 527.02 million dinars in the past year.
Kuwaiti investment firm Markaz has said that it had enough liquidity to pay off all liabilities without any difficulty. The firm affirmed that its short term debts did not exceed KD 29.2 million ($99.15 million), while long term debts due by 2012 are at KD 26.2 million. Kuwait and Middle East Financial Investment Co has announced that KMEFIC India Equity Fund has been liquidated effective from January 29, 2009 after getting due approval of over 80 percent of the fund units' owners and the also of the Central Bank of Kuwait and Ministry of Commerce.
Sagged
The market opened on weak note and fell sharply in early trading as profit taking dragged some of the frontline stocks across the sectors. The index dipped to the day's low of 6530.4 points and recovered thereafter as buying commenced at the lower levels in select counters. It moved range bound thereafter below the opening level and covered more ground in the second half of the session. The market however sagged again owing to fresh sell-oofs and closed well below the red starting point.
Kuwait's new budget has been slashed by KD 7 billion to KD 12.1 billion ($40.6 billion) owing to drop in oil prices takes. The cut will result in a decrease in welfare payments and infrastructure investment, the head of parliament's budget committee said. The 2009/10 budget starting in April, was based on an oil price of $35 a barrel, down from $50 barrel last year. Oil revenues were put at KD 6.7 billion, assuming an output of 2.2 million barrels per day. Investment in infrastructure projects would fall to KD 1.22 billion, down from KD 1.66 billion this year.
The market spread was biased towards the losers. 40 stocks advanced while 59 closed lower. Of the 118 counters active on Monday, 19 closed flat. 5152 deals worth KD 31.5 million were transacted -- down 32.8 percent in value over the previous session.
Top percentage gainer Mena Holding Co spiked 9 percent to KD 0.300 and International Leasing and Investment Co climbed 8.6 percent to stand next.
IFA (Hotels and Resorts) slid 8.7 percent the steepest decliner of the day. Al Safwa topped the volume with over 26 million shares changing hands.
By John Mathews
© Arab Times 2009
