Markaz: Kuwait markets remain strong on a year-to-date basis despite the dip in April 2025

Zawya

04-05-2025

Kuwait: Kuwait Financial Centre 'Markaz' released its Monthly Market Review report for April 2025. Kuwait equity market continues to be the top performer among GCC markets on year-to-date basis as of April 2025. However, during April, Kuwait markets were negative, in line with many global and regional markets. Kuwait's All Share Index declined by 1.4% amid concerns over impact of trade tensions on economic outlook and oil prices. Consumer staples and real estate were the top gainers, rising by 6.3% and 4.9% respectively. The banking sector index declined by 1.9% for the month. Among Premier Market stocks, Gulf Cables and Kuwait Real Estate Company were the top gainers, rising by 12.5% and 11.2% respectively. Gulf Cables announced that its subsidiary, Gulf Cable and Multi Industries Company has been awarded a tender for supplying copper and aluminium cables to Jordan Electric Power Company to the tune of KD 3.95 million (USD 12.91 million). This is likely to improve operational profit by 5% to 7% in 2025. Kuwait Real Estate Company had reported an 18.9% y/y increase in net profit in FY 2024 driven revaluation gains on investment properties. Its net rental income has also grown by 9.4% y/y amid strong demand and high occupancy levels.
IMF has lowered its estimate for Kuwait's real GDP growth in April 2025 to 1.9% down from its December 2024 estimate of 2.6%, due to delayed unwinding of production cuts during the year. OPEC+ began unwinding production cuts in April 2025, while it had initially planned to start in October 2024. However, OPEC+ has announced plans to further increase its production in May 2025. According to the new plan, Kuwait would be producing 2.443 million bpd, up from the earlier planned 2.428 million bpd. Kuwait has initiated merger of two of its state-owned oil firms, Kuwait National Petroleum Company (KNPC) and Kuwait Integrated Petroleum Industries Company (KIPIC), as the country plans to restructure its energy industry.
The S&P GCC Composite index declined by 1.0% in April 2025 with mixed performance across GCC markets, pressured by trade war concerns and the decline in oil prices. As part of its levy of tariffs on imports from countries across the World, the U.S has also levied a 10% blanket tariff on imports from GCC, effective from April 5. Saudi equity index declined by 2.9% during the month, even as positive earnings lent some support. ACWA Power and Saudi Aramco had declined by 6.2% and 5.2% respectively for the month. Saudi Telecom gained 5.0% for the month supported by 11% y/y increase in its net profit for Q1 2025. Abu Dhabi's equity index increased by 1.8% in April 2025, supported by gains in blue chips. First Abu Dhabi Bank gained 8.7% for the month on the back of major restructuring of its executive committee. Dubai's equity index gained 4.1% for the month, supported by real estate and banking stocks. Dubai Islamic Bank gained 5.4% for the month, as its net profit increased by 8% y/y in Q1 2025 on the back of growth in quality earning assets. Qatar's equity markets gained 2.2% for the month supported by positive earnings.
IMF has lowered Saudi Arabia's GDP growth for 2025 to 3.0%, down from 3.3% in January 2025 amid decline in oil prices and rising global risks. UAE is expected to grow by 4.0% in 2025, down from an earlier estimate of 5.1%. S&P has downgraded Bahrain's outlook to negative from stable citing elevated fiscal deficits amid lower oil prices, maintenance at the Abu Sa'fah oil field, impact of market volatility on funding costs and higher social spending.
Global markets were mixed during April 2025. The MSCI World index was slightly positive while the S&P 500 index declined by 0.8% for the month. Earlier in the month, U.S equities declined steeply on the back of Trump administration's announcement of a broad range of higher-than-expected tariffs as they fueled concerns over economic slowdown and resurgence of inflation. U.S had levied 145% tariffs on most Chinese goods and Beijing had retaliated with 125% levies on U.S. imports. U.S has also levied a 10% baseline tariff on almost all imports to the U.S. However, subsequent announcement of a 90-day pause on the reciprocal tariffs for most countries to allow time for negotiations and possible de-escalation of trade tensions between U.S and China have helped markets recover some of the losses. Nasdaq 100 gained 1.5% during the month, supported by better-than-expected earnings from tech stocks. IMF has lowered its global growth estimate for 2025 to 2.8%, down from 3.3% in January. The MSCI EM index gained 1.0% during the month supported by 3.7% rise in Indian equities. Chinese equities declined by 1.7% during the month due to trade tensions even as hopes of stimulus lent some support to the markets. While Indian equities had also been weighed down by concerns over levy of tariffs in the earlier part of the month but later recovered.
U.S inflation stood at 2.4% y/y in March 2025, declining from the 2.8% y/y reading in February 2025 due to decline in energy prices. The U.S labor market added 228,000 jobs in March, up from 117,000 jobs added in February. Job gains were supported by job gains in sectors such as healthcare, retail, transportation and construction.
The yield on the 10-year US treasury notes remained volatile during the month, declining by 6 bps for the month to 4.17%. Earlier in the month, amid concerns over high inflation and lower growth due to tariff tensions, 10-year yields had risen to about 4.48%. Subsequently, yields trended lower later in the month on hopes of easing trade tensions.
Oil (Brent) prices closed the month at USD 63.1 per barrel, down 15.5% during the month. The commodity reached a four-year low during the month, weighed by OPEC+'s decision to increase oil production and trade tensions. OPEC+ has decided to raise output by 411,000 bpd in May 2025, up from the earlier announced hike of 135,000 bpd citing healthy market fundamentals and the positive market outlook. However, output cut plans for some OPEC+ members, U.S sanctions targeting Iranian oil exports and optimism over U.S-EU trade deal aided in stemming decline in oil prices. OPEC+ has also announced updated output cut plans for 7 countries including Iraq, Kazakhstan etc. who have pumped above their agreed quotas. Gold prices closed at USD 3,287, gaining 5.3% during the month and 25.3% so far this year as the commodity continued to benefit from safe-haven demand and Central Bank buying amid trade tensions.
Persisting trade tensions amid levy of tariffs by U.S and retaliatory tariffs by countries like China has increased concerns over global growth and inflation outlook. This is likely to continue to impact global markets. However, pause in levy of reciprocal tariffs by U.S, E.U-U.S tariff negotiations offer some cause for optimism. While trade tensions and lower oil prices might dampen investor sentiment in GCC, positive outlook on corporate earnings, uptick in non-oil economic activity and continued implementation of reforms are likely to provide some support to markets.
About Kuwait Financial Centre 'Markaz'
Established in 1974, Kuwait Financial Centre K.P.S.C 'Markaz' is one of the leading asset management and investment banking institutions in the MENA region with total assets under management of over KD 1.41 billion (USD 4.57 billion) as of 31 December 2024. Markaz was listed on the Boursa Kuwait in 1997. Over the years, Markaz has pioneered innovation through the creation of new investment channels. These channels enjoy unique characteristics and helped Markaz widen investors' horizons. Examples include Mumtaz (the first domestic mutual fund), MREF (the first real estate investment fund in Kuwait), Forsa Financial Fund (the first options market maker in the GCC since 2005), and the GCC Momentum Fund (the first passive fund of its kind in Kuwait and across GCC that follows the momentum methodology), all conceptualized, established, and managed by Markaz.
For further information, please contact:
Sondos Saad
Corporate Communications Department
Kuwait Financial Centre K.P.S.C. "Markaz"
Email: [e-mail]
markaz.com