DUBAI Oct 21 Kuwait's bourse tumbled 3.1
percent on Sunday, its biggest daily drop since July 2009, ahead
of a demonstration called by opposition leaders to protest
against planned changes to the electoral law.
Market participants said they believed state-linked funds
were buying blue chips in an effort to support the market, as
they have done during some periods of weakness in the past.
But selling pressure was very heavy in small-capital stocks
favoured by retail traders, who cut their exposure because they
feared a confrontation between police and protesters on Sunday
"The government was trying to stabilise the market today
through the National Portfolio Fund, but the sell-flow was
heavy," said a Kuwait-based trader who asked not to be
identified. "There's only so much selling they can absorb."
Kuwaiti opposition groups accuse the government of mounting
a "a coup against the constitution". Sunday's protest was to
start from a number of locations in Kuwait City after Muslim
evening prayers and gather outside government offices.
State news agency KUNA reported Interior Minister Sheikh
Ahmad al-Hamoud al-Sabah had instructed security forces to
"decisively confront" any attempt to hold protests outside
designated areas. The ministry also said special forces were on
alert to deal with any unrest.
Kuwait has avoided the uprisings that have forced four Arab
heads of state out of office since last year, thanks partly to
its generous welfare system, but the protests may indicate
parliamentary elections scheduled for Dec. 1 will not end a
political deadlock between the cabinet and parliament that is
blocking economic policy-making and development.
The benchmark stock index slumped to 5,729 points,
near an eight-year low of 5,661 points hit in August. Its last
daily fall of this magnitude occurred when the global financial
crisis was affecting the market.
Blue chips recovered in late trade with the three largest
stocks, National Bank of Kuwait, Zain and
Kuwait Finance House, ending flat.
But among smaller caps, Gulf Finance House and
National Ranges dropped 6.9 and 11.4 percent
respectively, while Abyaar Real Estate lost 5.8
percent. Trading in these three stocks accounted for more than a
third of overall volume on the bourse.
"Kuwait's index is approaching the strong support zone of
5,660," said Mohabeldeen Agena, head of technical analysis at
Cairo's Beltone Financial.
"We are expecting the index to move flat between 5,650 and
5,800 before rising again. Any dip below 5,600 means that we are
going to see lower lows."
In Saudi Arabia, the bourse declined for a second
session, down 0.4 percent from last Wednesday's 10-day high as
investors cut risk with the approach of a long holiday.
Banks were lower with the sector's index down 0.4
percent. Heavyweight Al Rajhi Bank shed 0.4 percent,
Arab National Bank fell 1.2 percent and Bank Albilad
lost 1.8 percent.
Saudi Telecom Co (STC) weighed on the market with
a 3.5 percent drop after missing third-quarter profit estimates.
"We believe higher operating expenses, particularly outside
of Saudi, and a poor performance on the non-operating line led
to the net income miss," NBC Capital said in a note.
Bucking the trend, Refining & Petrochemical Co (PetroRabigh)
soars its daily 10 percent limit after announcing it
has swung to a quarterly profit. Shares close at their highest
since Sept. 19.
The firm made a net profit of 409.3 million riyals ($109
million) in the third quarter compared to a 280 million riyal
loss in the year-ago period, because of improved gross margins
on refined products and higher sales, PetroRabigh said.
Saudi Arabia's market will close on Oct. 25 for Eid al Adha
holidays and resume trade on Nov. 3.
In the UAE, Dubai's benchmark eased away from
Thursday's 25-week closing high, ending 0.3 percent lower.
Investors booked recent gains in Emaar Properties,
which slipped 0.8 percent. Emirates NBD shed 0.7
percent and Dubai Islamic Bank declined 1.0 percent.
Elsewhere, Abu Dhabi and Qatar's measures
ended essentially flat, while Oman's market eased 0.1
* The benchmark dropped 3.1 percent to 5,729 points.
* The index dipped 0.4 percent to 6,780 points.
* The measure slipped 0.3 percent to 1,650 points.
* The benchmark ended flat at 2,652 points.
* The measure eased 0.05 percent to 8,538 points.
* The index edged down 0.08 percent to 5,709 points.
* The measure declined 0.4 percent to 1,067 points.