Boursa Kuwait hails increasing international investor appeal

Reuters/Stephanie McGehee

• Total foreign turnover activity up 29%
• Exchange developing more liquid capital market 

The CEO of Boursa Kuwait says he is seeing increased confidence from international investors in the stock exchange as net profit grew by over 13 percent to KD18 million ($59 million) in 2022.

“We were successful in attracting institutional international investors, as total foreign turnover activity was up 29 percent, with a total traded value of KD5.5 billion, a testament to their increasing confidence in Kuwait’s capital market,” said Mohammad Saud Al-Osaimi.

Active investing by international investors came in at around KD760 million while total foreign turnover activity made up 18 percent of the total trades on Kuwait’s market, up 4 percent compared to the previous year. 

Total market capitalisation increased by 12.9 percent to reach KD46.7 billion while Boursa Kuwait’s total assets rose by 8.3 percent to KD119.6 million, a statement added.

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Hamad Mishari Al-Humaidhi, Boursa Kuwait chairman, said: “The exchange continues to implement its effective strategy to develop a more liquid capital market, solidifying its role as a key cog in the development of the national economy and working to attract investments from all over the world. 

“The company continued to raise the profile of the Kuwaiti capital market around the world to attract local and international investors from different investment orientations.

“This strategy, in line with the New Kuwait 2035 vision, aims to contribute to the transformation of our country into a financial and investment centre in the region.”

Al-Osaimi added: “Boursa Kuwait was able to develop its operations – despite the fluctuations in capital markets around the world as well as economies seeing unprecedented inflation levels, with many states drafting economic policies to curb them.

“The Kuwaiti capital market witnessed a resurgence of activity in the first half of 2022, as well as a relatively stable second half compared to capital markets around the world. 

“Additionally, the exchange continues to offer products and services that meet the needs of all stakeholders, streamlining their processes and improving their overall experience in the market.”

The 2022 results coincided with Kuwait Financial Centre’s monthly market review report for January which showed that Kuwait’s All Share Index witnessed a marginal decrease, posting a monthly loss of 0.2 percent. 

Among Boursa Kuwait’s sectoral indices, telecommunications and banking sectors gained the most at 1.4 percent and 1.1 percent respectively, while the Industrials sector lost 9.2 percent for the month. 

Aviation Lease and Finance Company, better known as Alafco, and Kuwait International Bank gained the most for the month, rising by 5.4 percent and 3.6 percent respectively while Agility and Jazeera Airways were the biggest fallers at 17.9 percent and 14.7 percent.

The performance came as Central Bank of Kuwait raised its policy rate from 3.5 percent to 4 percent in January, a few days ahead of the scheduled monthly meeting of the US Federal Reserve. 

According to latest forecasts by the UN, Kuwait’s real GDP is expected to grow at 2.8 percent while the country’s inflation is estimated at 3.2 percent in 2023. 

Boursa Kuwait recently updated its rulebook to incorporate rules for mandatory executions, as well as updating the order mechanism for market makers.

It also cancelled the buy-in session premium, as part of its efforts to offer greater flexibility to investment banks, asset management firms and financial brokerage companies. 

The number of market makers, which help increase liquidity and efficiency as well as facilitating trades, also increased from five to seven last year.

Boursa Kuwait was fully privatised in 2019, the first government entity in the country to successfully undergo the process. It also self-listed in September 2020.