|16 September, 2018

Boursa Kuwait's listing on FTSE EM index to attract $800mln liquidity

Will positively affect its performance through attracting more investments

Traders monitor stock information at the Borsa Kuwait Stock Exchange, in Kuwait City, Kuwait November 9, 2016. Image used for illustrative purpose.

Traders monitor stock information at the Borsa Kuwait Stock Exchange, in Kuwait City, Kuwait November 9, 2016. Image used for illustrative purpose.

REUTERS/Stephanie McGehee

Boursa Kuwait is closely awaiting the actual listing on the FTSE Russell index for emerging markets within the coming few days, which will positively affect its performance through attracting more investments.

The stock index compiler previously announced the inclusion of the Kuwaiti bourse in its EM index in two stages, one in late September, while the other will be in December 2018.

FTSE projected that Kuwait would have a total 0.4% weighting in the index.

Around 12 companies are expected to join the index including National Bank of Kuwait (NBK) and Kuwait Finance House (KFH).

In case of completing the process, foreign investments in the equity market may reach an average between $500 and $800 million, which may improve the bourse’s liquidity, financial analysts said.

However, Kuwait's Capital Markets Authority (CMA) should set both procedural and executive legislation and mechanisms to monitor the market in order to avoid any manipulation, they affirmed.

The inclusion in the FTSE Russell index will affect Boursa Kuwait positively through enhancing market’s liquidity gradually, technical analyst Nawaf Al Awn told Mubasher.

Moreover, Standard and Poor’s, the US financial services company, will reevaluate the market in November, and the positive rating will attract more portfolios and foreign sovereign funds, Al Awn added.

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