KUWAIT CITY, 4 January 2004 — The Kuwait Stock Exchange (KSE) kickstarted the New Year by soaring to a new all-time high yesterday on expectations of high 2003 dividends, traders said.
The index closed the first day of trading in 2004 at 4,863.30 points, up 1.5 percent on last year’s close of 4,790.20 points. The previous closing high of 4,819.00 points came on Dec. 30. The KSE trades a five-day week from Saturday to Wednesday.
The index ended 2003 a staggering 101.7 percent up on the previous year, hitting unprecedented levels on the back of positive political and economic indicators.
The overthrow of former Iraqi President Saddam Hussein, who in 1990 ordered his army to invade the oil-rich emirate, coupled with plans by the government to introduce economic reforms, contributed to the market’s historic gains.
Yesterday’s new high was reached despite warnings by economists and analysts that the market has exceeded the “logical” limits and that it was time for a long correction.
But traders say that forecasts of better-than-expected end of year profits by listed firms was the main driving force for the setting of a new record.
The index, which crashed in 1997, has been rising for more than three years. It closed 2002 up 39 percent after increasing 26.8 percent in 2001. Between 2000 and 2003, the index gained more than 250 percent.
The value of trading yesterday was 96.9 million dinars ($323 million), up on the average daily trading of 67 million dinars ($223 million) last year. Average daily trading was $86.4 million in 2002 and $48 million in 2001.
The KSE is the second largest stock market in the Arab world in terms of capitalization ($60 billion) after Saudi Arabia’s bourse. It has 108 Kuwaiti and non-Kuwaiti listed firms.