Kuwait to be added to S&P DJI Global Benchmark Indices with EM classification

Kuwaiti traders follow the stock market at the Kuwait Stock Exchange (KSE) in Kuwait City. (AFP)
Updated 06 December 2018
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Kuwait to be added to S&P DJI Global Benchmark Indices with EM classification

  • Kuwait is one of the standout performers in Gulf markets this year
  • S&P DJI said it recognized the progress Kuwait had made in trade clearing and settlement

DUBAI: Kuwait’s stock market will be added to S&P Dow Jones Indices’ Global Benchmark Indices with an emerging market classification, said Kuwait’s market regulator, citing the index provider.
It is the latest piece of good news for Kuwait, one of the standout performers in Gulf markets this year, and comes ahead of MSCI’s decision next year on whether to reclassify its Kuwait index from the current frontier-market status to its widely used emerging-market benchmark.
In a statement, cited by the Capital Markets Authority, S&P DJI said it recognized the progress Kuwait had made in trade clearing and settlement, including changing to a T+3 settlement cycle, meaning trades are settled within three days of execution, and establishing a delivery versus payment system.
It said the move would be effective before the market opens on Sept. 23, 2019.
Boursa Kuwait, which took control of the Kuwait stock exchange in early 2016, introduced a number of reforms such as relaxing listing rules, delisting companies seen as unfit for public investment and segmenting the market with different disclosure requirements.
Index provider FTSE Russell will include 12 Kuwaiti stocks in two phases — September and December 2018 — which will result in a weighting of just over 0.5 percent in its FTSE Emerging All Cap index.


World leaders prepare for Davos amid gloomy forecasts

Klaus Schwab, founder and executive chairman of the World Economic Forum. (AFP)
Updated 16 January 2019
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World leaders prepare for Davos amid gloomy forecasts

  • Delegates to annual forum to include presidents of Iraq and Afghanistan

DUBAI: World leaders are preparing to head to the annual meeting of the World Economic Forum (WEF) in Davos, Switzerland, amid the riskiest global backdrop in years, according to a report from the event organizer itself.

As the WEF announced the names of some of the 3,000 participants set to attend the meeting and details of the four-day agenda, it also published a gloomy outlook on international politics, economics, the environment and technology. 

Rising geopolitical and geo-economic tensions are the most urgent risks in 2019, with 90 percent of experts surveyed expecting further economic confrontation between major powers, according to the WEF’s annual Global Risks Report.

“The world’s ability to foster collective action in the face of urgent major crises has reached crisis levels, with worsening international relations hindering action across a growing array of serious challenges. Meanwhile, a darkening economic outlook, in part caused by geopolitical tensions, looks set to further reduce the potential for international cooperation in 2019,” it added.

Although political and economic worries were top of the immediate agenda for the 1,000 experts polled by the WEF, the environment and climate change are also a cause for concern, as are “rapidly evolving” cyber and technological threats, the WEF said.

Børge Brende, the WEF president, said: “With global trade and economic growth at risk in 2019, there is a more urgent need than ever to renew the architecture of international cooperation. We simply do not have the gunpowder to deal with the kind of slowdown that current dynamics might lead us toward. What we need now is coordinated, concerted action to sustain growth and to tackle the grave threats facing our world today.”

The leaders who will begin to arrive in Switzerland in the next week include Shinzo Abe, prime minister of Japan; Jair Bolsonaro, president of Brazil; Angela Merkel, chancellor of Germany; and Wang Qishan, vice president of China.

With US President Donald Trump pulling out of the meeting to deal with the partial government shutdown, the American delegation is expected to be led by Steven Mnuchin, Treasury secretary, and Mike Pompeo, secretary of state.

The Middle East is well represented at the meeting, with at least nine heads of state or government from the region, including Palestine, Iraq, Egypt, Jordan and Lebanon. Saudi Arabia will be represented by a team of senior policymakers and business leaders.

The risk report will give them all food for thought in the Alpine resort.

Asking whether the world is “sleepwalking into a crisis,” the report responded: “Global risks are intensifying but the collective will to tackle them appears to be lacking. Instead, divisions are hardening. The world’s move into a new phase of strongly state-centered politics continued throughout 2018.

“The idea of ‘taking back control’ — whether domestically from political rivals or externally from multilateral or supranational organizations — resonates across many countries and many issues.”

Macro-economic risks have moved into sharper focus, it said. 

“Financial market volatility increased and the headwinds facing the global economy intensified. The rate of global growth appears to have peaked,” the report said, pointing to a slowdown in growth forecasts for China as well as high levels of global debt — at 225 percent of global gross domestic product (GDP), significantly higher than before the financial crisis 10 years ago.

Raising the prospect of a “climate catastrophe,” the report said extreme weather, which many experts attribute to rapid climate change, was a risk of great concern. “The results of climate inaction are becoming increasingly clear,’ the WEF said.

Of the 3,000 participants at Davos, which runs from Jan. 22 to 25, around 78 percent are men, with an average age of 54. 

The oldest will be the 92-year-old British broadcaster David Attenborough, the youngest 16-year-old South African wildlife photographer Skye Meaker.