KUWAIT CITY, May 14, (KUNA): Eminent economists urged Thursday for speedy implementation of the key development projects announced recently by the government in order to revive the Kuwaiti stock market.
The stocks listed on Kuwait Stock Exchange will be the first beneficiaries of the cash flows to such projects, Deputy Chairman of the International Financial Advisors (IFA Kuwait) for Asset Manage-ment Abdullah Al-Khozam told KUNA.
“These projects will reflect positively on the contracting companies developing them and the banking sector financing them. The stocks of these companies and banks will boom as a result of the growth of financing for the planned projects,” he opined.
“The early implementation of these projects will give momentum to the investment cycle which will in turn enhance the confidence of investors particularly in the sectors of contracting and banking,” Al-Khozam noted.
However, he predicted that the impact of this process on the KSE would be seen only after 6 months or one year at most.
Meanwhile, Nayef Al-Enzi, a financial analyst, said the KSE-listed stocks have yet to benefit from the development plan.
“The plan has to entail a new dimension allowing foreign investors to take part in the development of projects side by side with the Kuwait ones with a view to creating a competitive investment activism and prodding economic growth,” he believes On his part, head of Diryal team for technical analysis Mohammed Al-Hajiri affirmed that the long-term impacts of the projects envisaged in the development plan on the local stock market would be “definitely positive.”
“Many of the KSE-listed companies had been hard hit by the global financial crisis in 2009. They pin high hopes on the recovery of the development cycle in order to make up for the last year losses,” Al-Hajiri pointed out.
“These companies, some of which had to change their boards in order to inject fresh blood to their management teams, are looking forward to bidding for key projects, thus reviving their stocks,” he added.
Abdulaziz Al-Rabbah, an prominent economist, said the private sector would play a pivotal role in the development process.
“The government has sent an upbeat message to the private sector about its involvement in the development of major projects, which will reflect positively on the stock market,” Al-Rabbah underscored.
The bourse closed at 7154.9 points paring stronger gains earlier in the session while the weighted index  rose 2.17 points to 433.84. The volume extend the rebound  with a  34.4 percent surge to 291.38 million. The liquidity has been low since the start of the month  as investors  toe the sidelines in absence of fresh cues after the Zain stake sale in March end.
The sectoral indices were mostly subdued. The banking sector climbed 0.7 percent -  the top performer of the day  while investment sector closed flat. Insurance sector  too closed flat  and real estate followed suit. Industrials gained 0.5 percent  whereas services were up 0.4 percent. Food sector was unchanged  while non-Kuwaiti added 0.3 percent.