Dubai: Analysts are selectively positive on Kuwaiti stocks after registering more than 16 per cent gains so far in the year post the inclusion on the FTSE emerging market index.
The Kuwait Stock Exchange index has gained nearly 30 per cent in the past one year, but the index have been giving away part of its gains since mid-September. On Monday, the index traded 0.19 per cent lower at 6,651.21.
“Overall our outlook is positive — though [investors] need to be selective — not all sectors or industries are attractive and more importantly we need to pick winners over
losers,” Vrajesh Bhandari, portfolio manager with Al Mal Capital told Gulf News.
Traders will have to play on the theme of government and infrastructure spending programme, and its impact on stocks.
Boursa Kuwait’s promotion to an emerging market will attract foreign investment into the country, minister of commerce and industry Khalid Al Roudhan said at a press conference in Kuwait.
CMA chairman Nayef Al Hajraf said the step will be instrumental in gaining the trust of local investors.
Saudi stocks:
The Tadawul stock exchange will need to further relax its norms pertaining to foreign ownership, said M.R. Raghu, executive vice-president at Markaz, for the index to become eligible for inclusion on the FTSE EM index.
Traders on Saudi’s Tadawul index, which was not included in the emerging market index by the FTSE, may continue to look at macroeconomic factors for direction.
“The Saudi government has demonstrated their ability to tide over the low oil price environment by successfully tapping capital in international bond markets,” said M.R. Raghu said.
The Tadawul index has underperformed its other peers in the Gulf, registering only 0.19 per cent gains so far in the year.
Meanwhile, the UAE and Qatar are already a part of the FTSE and MSCI emerging market indices.
