KUWAIT CITY, May 26: Kuwait’s benchmark broke a negative streak Wednesday and posted a gain of 0.1 percent on the back of some bluechips.
Stocks partially recouped Tuesday’s losses as global sentiments improved slightly.
Agility climbed while Wataniya retreated. NBK and Gulf Bank also advanced. Zain advanced intitally, but ended flat maintaining the previous day’s close of KD 1.300.
The telecom company has proposed a 170 fil-a-share dividend and is also expected to pay a special dividend later this year following the conclusion of its $9 billion African asset sale to India’s Bharti Airtel, with speculation the firm will discuss the latter at Thursday’s meeting.
Gulf Bank climbed 2.5 percent and Boubyan Bank added 2 percent as stocks recovered some of Tuesday’s steep losses that were sparked by a worldwide sell-off in equities, which was driven by Europe’s escalating debt problems.
Essa Al-Hasawi, assistant manager at Zumorroda Investment Co in Kuwait said “volumes are good so we should see a short-term rebound in the market.” He billed Tuesday as an over-reaction. “In the longer-term, the outlook is less upbeat, with trading likely to fall substantially over the summer months.”
The main index ended 6,807.3 points, but the weighted index, in which bluechips are more influential, climbed 0.2 percent to 409.73 points.
Kuwait also took cue from the Middle East markets which were seen bouncing back on Wednesday as a slight turnaround in oil prices and global equities drew buyers back to regional markets following sharp declines the day before.
Analysts expect short-term traders to continue to dominate, however, there is also likely to be selling pressure as investors chase a quick profit, with an uncertain international outlook deterring longer-term players from stepping in.
National Bank of Kuwait and Gulf Bank of Kuwait advanced, while Commercial Bank and Kuwait Finance House retreated. NBK gained 1.7 percent to end KD 1.180. Gulf Bank was up 0.5 percent. Commercial Bank was down 4 percent, and Kuwait Finance House shed 1.9 percent.
The banking sector witnessed the most volatile trading in the last couple of days, and evened out with Wednesday’s surge in investor sentiments.
The sectors were biased towards buying with all sectors except food sector selling lesser volumes than Tuesday. The overall market volume declined 36 percent with 147.4 million shares changing hands for KD 34.5 million, down 34 percent from Tuesday’s volume.
The investment sector was the largest seller pushing 45.3 million shares for KD 5.5 million. The investment sector moved 0.6 percent up.
National Investment Company moved 0.4 percent up taking in 15 fils to close 360 fils. Strategia Investment Company climbed 1.5 percent. Coast Investment and Development Company was the best seller in the investment sector. It sold 9.9 million shares and also topped the market charts.
Meanwhile, Kuwait’s Oil Minister Sheikh Ahmad Al-Abdullah al Sabah said on Wednesday Opec would take notice if oil dropped to $65 a barrel, but reiterated that there was still no need for the group to call an emergency meeting.
He said the market was not oversupplied and prices were linked to sentiment not fundamentals.
In another development, Kuwait’s parliament on Wednesday passed a law that established public shareholding companies to build electrical power and water desalination plants.
The bill is part of a privatization drive in the Opec member country, where electrical power generation is dominated by the government.
For each company formed, a 26 percent stake will be offered in an auction for local or international investors. The government will own a 24 percent stake, and the remaining 50 percent will be offered to Kuwaiti investors.  Shareholders of Kuwait’s Al-Mazaya Holding will vote on Wednesday on a capital hike worth 14.98 million Kuwaiti dinars ($51.48 million), the firm said.
Mazaya seeks to increase its capital by 30 percent by issuing 149.8 million new shares to shareholders of First Dubai and Waterfront Real Estate Development Co, the firm said in a statement on the Kuwaiti bourse website on Wednesday.
Last month, Mazaya said it would increase its 64 percent stake in First Dubai Real Estate Development, by at most 36 percent.
Mazaya, a developer, said then that the acquisition will take place through buying shares from First Dubai’s shareholders, in return for those shareholders subscribing in Mazaya’s capital increase.
Mazaya’s shareholders will decide on the rights issue at a price of 127 fils per share including premium.
Among realtors, Tamdeen Real Estate Company gained 3.7 percent taking in 10 fils to close 275 fils. Arab Real Estate Company advanced 3 percent. Abyaar Real Estate Development Company sold the most shares in the sector pushing 6.2 million shares.
Public Warehousing Company (Agility) climbed 3 percent to close 500 fils on the back of 3.7 million shares. Zain closed flat, while Wataniya took out 20 fils to close KD 1.680.
The services sector fell 0.1 percent selling 43.2 million shares for KD 12.9 million. The sectoral volume was down 2.7 percent and value 14.9 percent.
Equipment Holding Company was the best winner of the day at 8.06 percent. Future Communications Company Global climbed 7.8 percent, the second best gain in the market. United Projects Group was up 6.5 percent, followed by Heavy Engineering Industries and Shipbuilding Company at 5.7 percent. Burgan Well Drilling Company was up 5.3 percent.
Arkan Al-Kuwait Real Estate Company, on the other hand registered the worst loss of the day at 8.9 percent. Al-Masar Leasing and Investment Company fell 7.6 percent, followed by Hilal Cement Company at 7.2 percent. Gulf Franchising Holding Company was down 5.7 percent, while Mena Holding Company slid 5.4 percent.
Coast Investment and Development Company was the best seller in the market at 9.9 million shares. Al-Safat Investment Company sold 7.9 million shares, while National Ranges Company sold 7.4 million shares.