UPDATE 1-Kuwait traders protest mkt slide, seek govt action

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By Mahmoud Harbi

KUWAIT Oct 23 (Reuters) - More than 100 traders and investors demonstrated outside Kuwait's stock exchange on Thursday, demanding the government halt trading and help them cope with losses after another market slide.

"Halt the trading," several brokers shouted, flashing dinar banknotes to highlight what they have lost as they gathered in front of second-largest Arab bourse.

Other angry brokers showed medicines they planned to take to cope with rising stress levels as a result of a slide in the wake of the global financial crisis.

The Kuwait stock market .KWSE has fallen 33 percent since the start of July, while the Dow Jones .DJI shed 26 percent in the same period. Kuwait shares were down 3 percent on Thursday.

"The management of the bourse must do its job and monitor the fall, and government must pump money into the stock market," said dealer Waleed al-Zaabi, one of the protestors.

Kuwait's bourse has been hit by a string of irregularities. The country is the only Gulf state without a financial regulator as plans to set one up have been stalled due to a political stalemate between the government and parliament.

Some demonstrators handed out leaflets accusing the government of protecting major investors but leaving small investors to suffer.

"Billions went to some influential parties to save their investments abroad under the claim of supporting the market, leaving a majority of traders to their fate," the leaflet read.

Mohammad al-Atarah, head of a dealers' organisation, blamed a flurry of capital raising and share offers sucking up liquidity for the slide.

"Procedures need to be revised to stop this blood loss," he said, calling for a strict regulation for new listings.

Dozens of firms have launched share offers or rights issues to fund expansion with cell operator Mobile Telecommunications Co (ZAIN.KW) (Zain), the country's biggest stock, raising $4.5 billion in the Gulf's largest capital hike this year.

Others demonstrators demanded Commerce and Industry Minister Ahmad Baqer quit or urged the country's sovereign wealth fund, the Kuwait Investment Authority, which has said it is buying into local shares to stop a slide, to do more at home.

A bourse spokesman said trading was not interrupted, though many desks on the trading floor were vacant during the protest. (Writing by Ulf Laessing; Editing by Matthew Jones)