JEDDAH, 3 July 2005 — The Kuwait stock market rebounded in June due to rising oil prices and some more contracts signed by the Kuwaiti companies which helped boost market sentiment after a drop of 6.02 percent in May.
At the end of the first half of 2005, five out of six months have witnessed positive trends except for May, according to a report by the Kuwait-based Global Investment House (GIH).
The benchmark “Global” general index was up by 8.16 percent to end the month at 251.47 points. Continuing the trend from 2004, the KSE has registered a good 31.59 percent YTD gain at the end of June.
The GIH report said, the market capitalization of the stock exchange grew to KD31.06 billion in June, a growth of 8.92 percent compared with May. The Kuwait Stock Exchange index gained 6.16 percent to close at 8,811.30 points.
All the indices, with the exception of the food sector, had an upward movement in June. Food stocks, which had shown good growth since February, failed to continue the momentum in June and dropped by 2.69 percent to end the month at 275.99 points (Global Food Index). The undervalued banking sector finally caught the fancy of the investors to record the biggest gain (11.64 percent) of the month followed by the industrial and investment sectors, which also soared by 10.9 percent and 10.13 percent respectively, the GIH report said.
Buoyant investors’ sentiments have helped to strengthen both the volume as well as the value of trading activity. The volume of shares traded saw a substantial increase of 9.9 percent amounting to 4.2 billion shares compared with May. On the other hand, the value of shares traded also followed the upbeat trend and it increased by 4.6 percent aggregating to KD2.4 billion over the previous month.
The Kuwaiti market breadth favored the advancers over the decliners in June. There were 85 advancers, 43 decliners and 16 remained unchanged. The report said the biggest gainer was International Investment Project, which registered an increase of 56.9 percent, followed by KIC and National Industries Group.
On the flip side, the biggest loser was Shuaa Capital recording a decrease of 22.9 percent, followed by Gulf Glass Manufacturing Company and International Industrial Projects Group.
The banking sector was in the limelight through out the month. After announcing that National Bank of Kuwait (NBK) had signed a contract with Salhia Real Estate Company to lead manage the initial public offering (IPO) of their newly established company “Capital City Real Estate Co.” and that NBK itself has set up a new investment company, the bank’s stock reached a record high price. On the other hand, stocks of other banks like Commercial Bank of Kuwait (CoBK) and Al-Ahli Bank (ABK) have also performed well on the back of expected strong financial performance.
Industrial sector index has also been in the limelight with a substantial increase of 10.9 percent to reach 261.96 points. The sector was evenly poised between the gainers and losers at 10 apiece during the month; the biggest gainer was National Industries Group (52.9 percent) and the biggest loser was Equipment holding Company (10 percent), the GIH report added.
Out of 33 companies listed, 25 companies have shown positive trend in June led by KIC Holding (+54.7 percent) and International Investment Group (+51.5 percent). Out of 25 gainers in the sector, 13 companies have recorded a double digit percentage increase in their prices. On the other hand five companies in the investment sector have seen their value decline ? led by Aayan Leasing and Investment Co. (-10.3 percent) and Coast Investment & Development Co. (-8.2 percent), while three companies remained unchanged.
According to the GIH report, the Kuwait stock market saw four new listing in June, one investment company, Al-Dar Finance Company, and three services companies, Gulf Petroleum Investment Company, Gulf Franchising Company and Credit Rating and Collection Company, which increased the total number of listed companies to 144.